Whilst this economic calendar is particularly quiet in the UK this week, the US calendar will more than make up for it.
Yesterday company Director Tom Holian highlighted the importance of today’s US GDP Figure release at 1.30pm UK time. US Dollar bulls will be hoping for an improvement on the previous disappointing reading particularly if the FED is going to stick to its plan of 3 interest rate hikes this year.
The Fed fell short of its plans last year after raising rates just once despite planning 4 hikes, with some analysts accusing Fed Chairlady Janet Yellen of being overly cautious. The Fed has 7 more opportunities this year to raise rates with the next being March the 14th, followed by May the 2nd.
The below table shows Pound to US Dollar exchange rate differentials for the past 30 days.
If economic data impresses and rates are increased from the current 0.75%, I’m expecting to see the US Dollar continue to strengthen against most if not all major currency pairs. The US economy has recovered faster from the global economic crisis than most other major economies, including those of Europe as Yellen recently commented and I think that this should be considered when planning US Dollar transfers.
Aside from today’s GDP Figures there are a number of other key releases this week. After today’s GDP figures, there will Consumer Confidence figures released at 3pm offering an insight into the level of confidence that individuals have in economic activity in the US at present. Donald Trump will be giving a speech on Wednesday which needs little breakdown as by now financial markets are aware of the potential impact of his words, which are mostly strong.
There’s a plethora of data out of the US on Wednesday with Manufacturing PMI most likely the stand out release. The data comes out at 3pm and will indicate business conditions in the sector.
Janet Yellen will also be speaking on Friday and as the Chairlady of the Fed Reserve Bank any indications of future monetary policy could really swing US Dollar exchange rates.
If you would like to plan around these events do get in touch. At FCD we offer a number of different trade options, many of which our clients may not be aware of so do get in touch on 01494 725 353 if you wish to discuss these options in more detail.
The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.
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