Last week ended with a sharp weakening of the US dollar against most rival currencies. The exception was again GBP/USD pair that was down by the end of the week amid the results of regular surveys of the UK population on the issue of the UK staying in the EU. The number of supporters of the UK exit from the EU increased last week, and the number of bets on the exit in betting offices exceeded 80%.
The US dollar decline was particularly strong on Friday after the publication of disappointing data on the labor market in the US in May.
According to the data presented on Friday, seasonally adjusted US non-farm payrolls in May increased by 38,000 (with 164,000 forecasted), which was the lowest growth since September 2010. The figure for April was revised downwards to 123,000 against 160,000. However, the unemployment rate decreased to 4.7% (with forecasted 4.9% and 5.0% in April). Amid the weak NFPR data, the dollar collapsed on the foreign exchange market. Weak services ISM data (52.9 vs. forecasted 55.5 and 55.7 in April) gave additional downward momentum.
The upcoming trading week will bring a number of important data and several important news:
11:30 (GMT +2) - publication of LTRO data, reflecting the ECB's efforts to support the liquidity of the banking system in the euro zone.
18:30 - speech of the Federal Reserve's Chair Janet Yellen. The markets wonder what she will say about the future plans of the Federal Reserve monetary policy after Friday NFPR.
06:30 – RBA's decision on interest rates in Australia.
07:00 - Leading / coincident indicators for Japan in April.
11:00 - GDP in the euro zone in the first quarter.
14:30 - productivity and labor costs in the first quarter in the US.
22:30 - American Petroleum Institute (API) will publish its report on the changes in US oil inventories for last week.
1:50 - Japan's GDP data in the first quarter, foreign trade balance of Japan in April.
3:30 - mortgages in Australia. This indicator traces the development of the trend in the housing market in Australia, and the level of consumer confidence. Data on foreign trade balance of China in May is also published in this period. Publication of this data can cause a spike in volatility of both the yuan and the US dollar that the yuan is in fact linked to, as well as other currencies. China's economy, being the second largest in the world, has a strong impact on the world's GDP, and the indicators of its condition affect the entire financial market.
09:15 - consumer price index in Switzerland in May.
10:30 - Industrial production in the UK in April.
16:00 - assessment of GDP growth in the UK from the National Institute of Economic and Social Research (NIESR), which is published before the release of official GDP data. The evaluation can influence the monetary policy of the Bank of England.
16:30 - US Department of Energy publishes its weekly report on US oil and petroleum products inventories.
23:00 – RBNZ's decision on interest rates in New Zealand. Current rate is 2.25%. After this, a press conference of the RBNZ will take place.
3:30 - Consumer Price Indix and Producer Price Index (PPI) in China in May. High values of the indices are considered a positive factor for the yuan, and vice versa.
7:45 - unemployment rate in Switzerland in May (forecast 3.5%).
08:00 - payment and foreign trade balance data in April in Germany, whose economy is the locomotive of the euro zone economy. This indicator can cause volatility of the EUR.
14:30 – Initial and Repeated Jobless Claims in the US for last week. Higher-than-expected (267,000) result points to the weakness of the labor market, which has a negative impact on the US dollar.
00:45 - Plastic card retail sales in New Zealand in May.
06:30 - services PMI in Japan in April.
08:00 - wholesale and consumer prices indices in May in Germany. Consumer price index (CPI) reflects the average change in prices of all goods and services purchased by households for consumption, it is a key indicator of inflation in Germany. A high value is positive for the EUR and vice versa.
15:00 - unemployment and employment rate in Canada in May.