Last week the USD and the US stock indices had grown due to the victory of Donald Trump in the US presidential election. Investors continued to withdraw money from the safe-haven assets, such as the Yen, precious metals and government bonds. The sale of U.S. Treasury bonds continued last Friday and the yield on 10-year securities increased to 2.337% from 2.278% last Thursday.
The index ICE has grown by 0.3% to 101.21 for the first time since April 8, 2003, with the closing price exceeding 101.00. The index demonstrated the longest rise since March 2015, as the index has been growing for 10 consecutive sessions. During this time the index has grown by 4.3%. It is expected that Donald Trump will stimulate US economy introducing tax benefits and expansion of spending on infrastructure. This fact encourages investors to buy US currency and shares of the major banks, medical, technological, biotechnological and the industrial enterprises.
Macro-economic statistics and important news of this week are as follows:
19:00 (GMT+3) – a speech of the ECB President, Mario Draghi. His speeches after the meetings of the ECB devoted to monetary policy usually trigger the rise in volatility in the financial markets. However, in any case, traders shall be extremely careful when trading in the currency market, particularly with the Euro and the European indices.
Last week, Mario Draghi said that the current monetary incentives will be continued in Eurozone in the coming years.Last Friday, the pair EUR/USD fell to the level of 1.0585, lows of the closing level since November 30, 2015. The pair has been declining for 10 consecutive days.
Today, the pair is undergoing correction;, however, it seems that the decline in the Euro will continue.
10:45 – A speech of Mr. Kent Deputy Governor of the RBA.
12:30 – report on the net borrowing of the British government (financial deficit on the UK national accounts). Negative index will mean the surplus of the British accounts, which is a positive factor for the GBP. The forecast is 6.0 billion pounds. If the forecast is correct, it will have a negative impact on the pound.
00:30 – American petroleum Institute (API) will publish report on changes to the US oil stocks for the last week.
11:30 – Preliminary purchasing managers index in various sectors of German economy in November.
12:00 – Preliminary Markit index of business activity in various sectors of German economy in November.
13:00 – ECB report on financial stability in Eurozone. Volatility in the Euro may increase.
16:30 – weekly data of the U.S. Labor Department on the number of initial requests for unemployment benefits. If the index is higher than expected, it will have a negative impact on the USD. Previous index was 235 000.
US orders for durable goods in October. The indicator shows the price of orders received by manufacturers of durable goods with involvement of large investments. High results will support the USD.
17:45 – Markit PMI in the U.S. manufacturing sector in November.
18:00 – New home sales in the US in October.
18:30 – Changes to the US oil and petroleum inventories for the last week from the US Department of Energy.
21:00 – minutes of the last FOMC meeting, which may imply future monetary policy. The minutes are important for determining monetary policy and making interest rate decision. According to futures on the US interest rate probability of the rate hike in December is over 90%.
National holiday in the USA - American stock markets will be closed.
03:30 – Japanese leading/coincident indicators for September.
10:00 – Consumer confidence in Germany for December. German GDP for Q3. Preliminary GDP was at the level of +0.2% on monthly basis and +1.7% on annual basis.
11:15 – Industrial production in Switzerland for Q3.
12:00 – IFO index of business optimism and economic expectations in Germany for November. These indexes are the indicators of the current business conditions and business expectations in Germany. The rise in these indices will be the bullish factor in the EUR.
00:45 – trade balance of New Zealand for October. In September the index showed trade balance deficit of 1.436 billion NZD. New Zealand’s economy depends on commodity exports and major item of export is milk powder and other dairy products. The increase in the deficit will have a negative impact on the NZD.
02:30 – Important Japanese macro-economic statistics: consumer price index in November and prices of corporate services in September. It is expected that volatility in the yen and Japanese stock market will increase.
12:30 – Preliminary British GDP in Q3. The index remains one of the highest in the world on annual basis. It is expected that the index will go up by 2.3%. The leading sector of the British economy is the service sector, which accounts for 75% of the country’s GDP; financial services accounts for 27.7 % of GDP. The country is one of the world's financial centers, dealing with 10% of the world’s export of services (banking, insurance, brokerage, advisory, software). If the data on GDP is weaker than expected, it may force the Bank of England to lower interest rate, which will put pressure on the pound. The main factors that can force the Bank of England to lower the rate are slowdown in GDP growth, poor data on the labour market and low inflation in the UK.
17:45 – Markit index of business activity in the US services sector and composite index of business activity (Markit PMI for November). If the index exceeds 50, it will be a positive factor for the USD.
21:00 – Report on the active drilling rigs by the US oilfield services company Baker Hughes. This index is an important indicator of activity in the US oil sector. This index has a significant impact on the oil prices. Currently, the number of active rigs is 471.