Forex Daily Outlook – February 16th 2010
Daily Look

Forex Daily Outlook – February 16th 2010

After a rather easy day, the calendar is busy again: British inflation numbers, German ZEW Economic Sentiment and American TIC Long-Term Purchases are the highlights. Let’s start:

In Australia, we’ll get to see why the RBA didn’t raise the rates as expected. The Monetary Policy Meeting Minutes might also reveal future policy.

Also in Australia, NAB Business Confidence is expected to remain stable at around 8 points and RBA Assistant Governor Guy Debelle will make a public appearance, and might add to the meeting minutes. For more on the Aussie, read the AUD/USD forecast.

In Britain, inflation is expected to exceed the government’s target of 1-3% and to provide a test for BOE Governor Mervyn King that dismissed the rising inflation. CPI is predicted to rise in an annualized rate of 3.6%, much more than last month’s 2.9% rise.

Core CPI is also predicted to rise to 3.2% after 2.8% last month, and RPI, which was negative for many months, is predicted to leap from 2.4% to 3.8%.

If these expectations are met, King is obliged to issue an open letter that will detail the reasons for this situation and the measures that will be taken to address it.

For more on the Pound, read the GBP/USD forecast.

In Europe, ZEW Economic Sentiment will shake the Euro. This important survey always has a strong impact. In recent months, it fell down. This trend is predicted to continue. The German ZEW Economic Sentiment is predicted to drop from 47.2 to 42.6 points, and the all-European figure is predicted to go from 46.4 to 42.6 points.

The Euro continues to struggle, especially due to the Greek debt problems. For more, read the EUR/USD forecast. For an interesting technical analysis, read Casey Stubbs’ latest analysis.

In Canada, an eventful week begins with the release of Manufacturing Sales, which are predicted  to rise by 2.1%. USD/CAD tumbled down last week. Check out the Canadian dollar forecast for more.

American Empire State Manufacturing Index is expected to rise from 15.9 to 17 points, showing more improvement for the US economy. TIC Long-Term Purchases usually shake the market – after leaping to 126 billion last month, they’re expected to cool down to 50 billion. This represents the cash flow into the US – confidence in the economy.

Later in the US, Federal Reserve Bank of Kansas President Thomas Hoenig will make a public appearance. Hoeing is a known “hawk”, so talks about raising the rats probably won’t surprise the listeners.

Near the end of the day, Japan’s Tertiary Industry Activity will be released, and it’s expected to drop by 0.2%. The good GDP result failed to lift the yen yesterday.

That’s it for today. Happy forex trading!

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Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.