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.
USD: waiting for the reaction of the US purchasing managers
The United States will publish ISM manufacturing PMI on April 1, at 17:00 MT time.
Instruments to trade: EUR/USD, USD/JPY, USD/CHF
Purchasing managers' index or PMI is an indicator based on the survey of purchasing managers in the manufacturing industry. It demonstrates businesses' attitudes toward the current market situation. If the indicator is higher 50, it shows the expansion of an industry, while an indicator below 50 signals a contraction. Due to the unstable situation in the US market, the index reached only 50.1 points (vs. 50.5 points expected) last time. It pulled the USD lower in the short-term.
• If the actual level of indicator is higher than the forecasts, the USD will strengthen;
• If the actual level of indicator is lower than the forecasts, the USD will weaken.
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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.