Forex Weekly Outlook – March 29 – April 2

The upcoming week contains important events in many countries: Japan’s Tankan index, Canadian and British GDP and employment from Europe and the US – the Non-Farm Payrolls, which are the climax. Will the dollar continue to advance for another week? Here are the biggest market movers expecting us this week.

Non-Farm Payrolls are published on the first Friday of the month, as usual, but this time it’s Good Friday, a holiday in most countries. What will happen in the markets? And who will be there to trade? Apart from the regular events, financial leaders from the Group of 8 (G8) will be meeting in Gatineau, Canada and they might release some market moving statements. OK, let’s see the events:

1. British Final GDP: Published on Tuesday at 8:30 GMT. According to the first and second releases, Britain got out of recession in the fourth quarter of 2009, although it was partly due to a downwards revision of Q3’s number. The second release showed a growth rate of 0.3%, and this will probably be confirmed now. Any revision will rock the Pound.
2. American CB Consumer Confidence: Published on Tuesday at 14:00 GMT. 5,000 households are surveyed for this important survey on economic conditions. Last month saw a painful drop from 56.5 to 46 points, the lowest level since April 2009. A recovery to 50.3 is expected this time. Choppy trading will be seen during this time.
3. European Unemployment Rate: Published on Wednesday at 9:00 GMT. Europe’s unemployment rate is big burden on policymakers, although it’s currently overshadowed by the debt problems in Greece and Portugal. The dip to 9.9% is a small psychological relief after reaching 10%. A rise back to double digits – 10%, as it was beforehand, will hurt the Euro.
4. Swiss KOF Economic Barometer: Published on Wednesday at 9:30 GMT. This important Swiss indicator has been on the rise in recent months, reaching 1.87 points last month, and exceeding expectations. It seems that the Swiss National Bank gave up on interventions and lets EUR/CHF fall, despite their strong words. This indicator will give another push to the Swissy. It’s expected to edge up to 1.91 points.
5. American ADP Non-Farm Payrolls: Published on Wednesday at 12:15 GMT. This important indicator always shakes the markets, but it is far from predicting the Non-Farm Payrolls on Friday. In recent months, a positive surprise in this indicator meant a disappointment in the NFP, and vice versa. A loss of 20,000 jobs was reported last time. And now, a rise of 41,000 jobs is predicted.
6. Canadian GDP: Published on Wednesday at 12:30 GMT. Canada’s monthly GDP surprised last month with a strong rise of 0.6%, boosting the Canadian dollar. The upcoming release is the first for 2010. We’ll probably see the positive trend continue in January as well with a rise of 0.5% in GDP.
7. Japanese Tankan Manufacturing Index: Published on Wednesday at 23:50 GMT. This is one of the most important Japanese indicators, released only once per quarter. About 1,200 manufacturers are surveyed by the Bank of Japan. The Tankan Manufacturing Index. The last score was -24, still negative, meaning worsening conditions, but the best since the end of 2008. Another improvement to -14 is predicted this time.
8. American Unemployment Claims: Published on Thursday at 12:30 GMT. American jobless claims have been improving in recent weeks, dropping from 496K to 442K. This weekly indicator has proved to be a good indicator for the Non-Farm Payrolls. Another drop in claims will raise expectations for the major figure in the next day. They are expected to remain almost unchanged.
9. American ISM Manufacturing PMI: Published on Thursday at 14:00 GMT. Purchasing managers in the manufacturing sector have been optimistic in the past 7 months, with a score above 50. After reaching a peak of 58.4 points, the score fell to 56.5 points last month. A small rise to 57.2 is expected this time.
10. American Non-Farm Payrolls: Published on Friday at 12:30 GMT. The king of forex is special this time – it’s published on Good Friday – Easter. Banks in Europe, Canada, Australia and New Zealand will be closed. No other indicators are released on this day. Liquidity will be extremely low. The American Bureau of Labor Statistics will still publish this important figure. The US lost 36,000 jobs last month, slightly better than the low expectations. A huge gain of 187,000 jobs is expected now. The unemployment rate remained unchanged at 9.7% and is expected to remain unchanged this time as well.

That’s it for the major events this week.

Further reading:

• For the Euro, read the  EUR USD Forecast.
• For the British Pound, look into the  GBP/USD forecast.
• For the Australian dollar, read the  AUD/USD forecast.
• For USD/CAD, check out the  Canadian dollar forecast.

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