Last week several important economic updates influenced the Forex market. US preliminary GDP fell less than expected (0.6% actual vs. 0.7% forecast). Below you will find the key events to trade on during the week from August 29 to September 2.
Greenback is intact ahead of Fed gathering
On Wednesday, the evergreen buck stood still due to the fact financial markets waited for the conclusion of the Fed’s latest gathering, while the New Zealand dollar rallied versus the evergreen buck on a better-than-anticipated business confidence report.
The key American financial institution is widely anticipated to have interest rates lifted in the day. Financial markets also hope for another rate lift before the year end. However, the outlook for next year appears to be less clear.
As well as an interest rate verdict, the key US bank is going to uncover its summary of economic projections, disclosing policymakers' expectations on economic surge, unemployment, and inflation.
Tracking the greenback’s purchasing power versus its main counterparts the USD index didn’t change sticking with 93.73. Since August, the USD index has dived by 3%.
Global trade tension was still in focus because China’s Vice Commerce Minister Wang Shouwen told that the Chinese government would resume trade negotiations only if America demonstrates sincerity and gives up an idea of threatening China.
Then Wang told that the two partners were braced for having four rounds of negotiations, although America went back on what they had already agreed.
In the trade clash, America and China haven’t managed to make much progress on having direct talks, as some financial analysts pointed out.
Besides this, the New Zealand dollar jumped because September’s business confidence index from the Australia as well as New Zealand Banking Group amounted to -38.3 versus the ten-year minimum of -50.3 observed in August. As for the NZD/USD, this currency pair hit 0.6675, adding 0.5%. The currency pair AUD/USD managed to jump by up to 0.3% coming up with an outcome of 0.7275.
Aside from that, the currency pair USD/JPY went down by about 0.05% reaching 112.91.
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Main news that will drive the market in the upcoming week include CB Consumer Confidence Index, Canadian GDP, and US Core PCE Price Index
The Federal Reserve (Fed) will announce its Interest Rate Decision and make a statement about the future monetary policy on Wednesday, September 21, GMT+3. After the higher-than-expected inflation numbers published on September 13, there’s almost no doubt the Federal Reserve will come up with another 75-basis-point rate hike. However, surprised by the CPI numbers, several Fed members announced the possibility of a 100-basis-point rate hike on Wednesday.