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Lagarde and Powell

Week Ahead: U.S. PCE Index, Lagarde and Powell Speeches

As the forex market gears up for another eventful week, traders are paying close attention to a range of economic events and speeches that have the potential to sway currency values.

Here are the key highlights and their potential implications for traders:

DateEventPotential Implications for Traders
Nov 27ECB President Lagarde SpeechInsights into monetary policy and future actions
Nov 27USA New Home SalesStrength of the housing market
Nov 28RBA Governor SpeechPotential changes to interest rates
Nov 28CB Consumer ConfidenceMarket sentiment and spending intentions
Nov 29Australia CPI y/yInflation levels and potential rate movements
Nov 29RBNZ Rate StatementMonetary policy decisions and economic outlook
Nov 29German Prelim CPI m/mEurozone economy and potential tightening
Nov 29Spanish Flash CPI y/yOverall health of the Eurozone
Nov 29USA Prelim GDP q/qUnited States’ economic performance
Nov 29BOE Gov SpeechPotential changes in UK monetary policy
Nov 30China’s Manufacturing PMISnapshot of China’s manufacturing sector
Nov 30OPEC-JMMC MeetingsOil production levels and crude oil prices
Nov 30Eurozone’s Core CPI Flash EstimatePrice stability and potential policy adjustments
Nov 30Canada’s GDP m/mCanadian economic growth
Nov 30ECB President Lagarde SpeechFurther clarification on policy stance
Nov 30USA Core PCE Index m/mFederal Reserve’s inflation gauge
Nov 30Unemployment ClaimsHealth of the US job market
Nov 30Pending Home Sales m/mFuture housing market activity
Dec 1Canada’s Employment ChangeHealth of the Canadian labor market
Dec 1Canada’s Unemployment RateStrength of the Canadian economy
Dec 1USA ISM PMIEconomic activity in the US manufacturing sector
Dec 1Fed Chair Powell SpeechMonetary policy decisions and economic outlook
From TraderFactor’s Economic Calendar

Monday 27th November 2023

ECB President Lagarde Speech

ECB President Christine Lagarde’s speech is anticipated to provide insights into the central bank’s monetary policy stance and potential future actions. Traders will closely analyze her remarks for any hints regarding interest rate adjustments or changes in the ECB’s bond-buying program.

USA New Home Sales

The release of new home sales data from the United States will provide valuable information about the strength of the housing market. Higher-than-expected numbers could signal a robust economy, while weaker figures may indicate a slowdown in the sector.

Tuesday 28th November 2023

RBA Governor Speech

The speech by the Reserve Bank of Australia (RBA) Governor will be closely monitored for any indications of potential changes to interest rates or monetary policy. Traders will be keen to assess the RBA’s outlook on the Australian economy and its impact on the Australian dollar.

CB Consumer Confidence

The Conference Board’s Consumer Confidence Index reflects consumers’ sentiment towards the economy and their spending intentions. A higher reading could boost market confidence and potentially strengthen the domestic currency.

Wednesday 29th November 2023

Australia CPI y/y

Australia’s Consumer Price Index (CPI) provides crucial information about inflation levels. Any surprises in the CPI figures could lead to increased volatility in the Australian dollar as traders reassess their expectations for future interest rate movements.

RBNZ Rate Statement

The Reserve Bank of New Zealand (RBNZ) Rate Statement will shed light on the central bank’s latest monetary policy decisions and its assessment of the country’s economic outlook. Traders will closely watch for any indications of potential interest rate changes or policy shifts.

German Prelim CPI m/m and Spanish Flash CPI y/y

Inflation figures from Germany and Spain will be closely watched as they provide insights into the overall health of the Eurozone economy. Higher-than-expected inflation rates could increase expectations of future tightening measures by the European Central Bank (ECB).

USA Prelim GDP q/q

The release of preliminary Gross Domestic Product (GDP) data for the United States will offer a comprehensive assessment of the nation’s economic performance. Positive growth figures may strengthen the US dollar, while weaker-than-expected results could lead to its depreciation.

BOE Gov Speech

Bank of England (BOE) Governor’s speech will be closely followed by traders as they seek clues about potential changes in UK monetary policy. Any remarks on interest rates, inflation, or economic outlook could impact the British pound.

Thursday 30th November 2023

China’s Manufacturing PMI

China’s Manufacturing Purchasing Managers’ Index (PMI) provides a snapshot of the country’s manufacturing sector. A higher-than-expected reading could boost market sentiment and potentially strengthen the yuan.

OPEC-JMMC Meetings

The Organization of the Petroleum Exporting Countries (OPEC) and its allies will convene in the Joint Ministerial Monitoring Committee (JMMC) meeting. Any decisions regarding oil production levels could influence crude oil prices, consequently affecting currencies tied to petroleum-exporting nations.

Eurozone’s Core CPI Flash Estimate y/y and CPI Flash Estimate y/y

Inflation data from the Eurozone will be closely monitored by traders looking for signs of price stability. Higher-than-expected inflation rates may increase pressure on the ECB to tighten monetary policy.

Canada’s GDP m/m

Canada’s Gross Domestic Product (GDP) figures will provide insights into the country’s economic growth. Unexpected changes in GDP can impact the Canadian dollar, with stronger growth potentially strengthening the currency.

ECB President Lagarde Speech

ECB President Christine Lagarde’s second speech of the week may further clarify the central bank’s policy stance. Traders will closely analyze her remarks for any indications of future monetary policy adjustments.

USA Core PCE Index m/m

The Core Personal Consumption Expenditures (PCE) Index serves as the Federal Reserve’s preferred inflation gauge. Higher-than-expected readings could fuel speculation about potential interest rate hikes, potentially strengthening the US dollar.

Unemployment Claims

The weekly release of unemployment claims data from the United States will provide insights into the health of the job market. Lower-than-expected figures may indicate a robust labor market, potentially benefiting the US dollar.

Pending Home Sales m/m

Pending Home Sales data reflects signed contracts for home purchases and provides a glimpse into future housing market activity. Positive figures could signal strength in the real estate sector, potentially supporting the domestic currency.

Friday 1st December 2023

Canada’s Employment Change and Unemployment Rate

Canada’s employment figures will provide valuable insights into the health of the Canadian labor market. Higher employment change and a lower unemployment rate can potentially boost the Canadian dollar, signaling economic strength.

USA ISM PMI

The Institute for Supply Management (ISM) Purchasing Managers’ Index (PMI) measures the economic activity of the manufacturing sector in the United States. A higher-than-expected reading could indicate an expanding economy, potentially strengthening the US dollar.

Fed Chair Powell Speech

Traders will closely watch Federal Reserve Chair Jerome Powell’s speech for any indications of future monetary policy decisions. His remarks on interest rates, inflation, and economic outlook can significantly impact market sentiment and currency values.

As traders navigate the forex market this week, these events will likely serve as key drivers of volatility and potential trading opportunities. Stay tuned for updates and be prepared for market reactions as these events unfold.

EUR/USD Retreats from Near 1.0960

The EUR/USD pair has retreated from near 1.0960 after Wall Street’s opening, as European Central Bank President, Christine Lagarde, speaks before the Committee on Economic and Monetary Affairs of the European Parliament. The US Dollar meets modest intraday demand. Despite financial markets being cautious, the EUR/USD pair maintains its positive tone and battles the strong static resistance level at 1.0960. Demand for safety diverges away from the US Dollar, contributing to its selling pressure.

According to the U.S. Census Bureau and the U.S. Department of Housing and Urban Development, new residential sales statistics for October 2023 reveal that sales of new single-family houses were at a seasonally adjusted annual rate of 679,000. This data was jointly announced today by the two organizations.

It is worth noting that this figure is 5.6 percent (±12.3 percent)* below the revised September rate of 719,000. However, it represents a substantial increase of 17.7 percent (±17.9 percent)* compared to the October 2022 estimate of 577,000.

GBP/USD Holds Near Two-Month High of 1.2644

GBP/USD is holding higher ground near a fresh two-month high of 1.2644. The pair received support from hawkish Bank of England commentary and a broadly weaker US Dollar. However, the poor performance of stocks limits the pair’s advance.

GBPUSD Daily Chart

GBPUSD daily chart

USD/JPY Experiences Downward Pressure

USD/JPY faces downward pressure as the Federal Reserve is expected to ease monetary policy. Mixed S&P Global PMI data further contributes to the US Dollar’s losses. On the other hand, the Japanese Yen strengthens against the US Dollar due to Japanese inflation data.

USDJPY Daily Chart

USDJPY Daily Chart

Bank of Japan Governor, Kazuo Ueda, downplays the likelihood of consistently reaching the 2.0% inflation target. He expresses caution about market expectations regarding a potential policy shift by the BoJ, despite acknowledging the moderate recovery of the Japanese economy.

Gold Surges at the Start of the Week, Eyeing Six-Month High and Potential Record Highs

Gold price maintains its position above $2,010 per troy ounce during the European session on Monday, benefitting from the weakness of the US Dollar. Speculation that the Federal Reserve has concluded its interest rate hikes has contributed to the Dollar’s decline and provided support for the yellow metal.

XAUUSD Daily USD

XAUUSD Daily USD

With a half percent increase and hitting a six-month high, gold’s momentum has been bolstered by softer US data and less hawkish Fed commentary. This positive trend, coupled with news of increased financial support for private firms by the People’s Bank of China, suggests that gold may have the potential to move towards record highs in the near future.

OPEC+ Meeting Holds Key Implications as Oil Sinks and Markets Await Bold Measures

Oil prices experience a decline, with WTI sinking to $74 and reaching a pivotal level. As traders brace for an eventful week, the US Dollar remains flat to lower. The fate of oil hangs in the balance as OPEC+ prepares to convene in a crucial meeting. Failure to reach a consensus and implement supportive measures could potentially push oil below $70.

WTI Chart

WTI chart

Scheduled for Thursday, the OPEC+ meeting carries significant implications for the market. Any decision made by the alliance will have a direct impact on oil prices and subsequent inflation. The fact that the meeting has already been delayed by four days highlights underlying disagreements within the group.

The outcome of the OPEC+ meeting will determine the path forward for oil markets and shape investor sentiment. All eyes are on the alliance as markets await bold and unified measures that can restore stability and support oil prices.

Disclaimer:

All information has been prepared by TraderFactor or partners. The information does not contain a record of TraderFactor or partner’s prices or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may read it. Past performance is not a reliable indicator of future performance.

Author

  • Zahari Rangelov

    Zahari Rangelov is an experienced professional Forex trader and trading mentor with knowledge in technical and fundamental analysis, medium-term trading strategies, risk management and diversification. He has been involved in the foreign exchange markets since 2005, when he opened his first live account in 2007. Currently, Zahari is the Head of Sales & Business Development at TraderFactor's London branch. He provides lectures during webinars and seminars for traders on topics such as; Psychology of market participants’ moods, Investments & speculation with different financial instruments and Automated Expert Advisors & signal providers. Zahari’s success lies in his application of research-backed techniques and practices that have helped him become a successful forex trader, a mentor to many traders, and a respected authority figure within the trading community.