The coming week will become very important for the US Dollar and will be rich in the macroeconomic releases and events. The USFR Federal Open Markets Committee will hold its next two-day meeting the outcome of which will be published on Wednesday at 19:15 GMT. On the same day at 13:15 GMT a media release on the new jobs in the non-industrial sectors of the US will be made by ADP Inc., and on Friday, the Labor Data Bureau will publish the equivalent data as well as the unemployment level figures.
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The US Dollar’s dynamics in relation to the world’s main currencies over the period of January21-25 turned out rather noisy and volatile, since the news background proved saturated and controversial. The macroeconomic data from the Eurozone continued improving, provoking growth of demand for the risky assets while in Asia the Bank of Japan meeting’s outcome initially disappointed the currency market’s participants. No key macroeconomic data from the US was published over this period yet the data that was being released was of a generally positive nature, hinting at the increase of the world’s largest economy’s growth pace and decreasing the chances for the third round of the quantitative easing being protracted. Therefore, the Dollar failed to substantially change its positions after the week. Closer to the second half of the day on Friday, January 25, the USDX index lost 0.2% in the aftermath.
Over the period of January 21-25, no major macroeconomic data from the US will be released, capable of significantly impacting the fundamental picture. We suppose the Dollar’s movements will be mainly determined by the news background, the focus of which will remain on the events around raising the debt ceiling. Barack Obama and the Republicans have exchanged serious rebukes, and the US President has even accused his opponents of an attempt at blackmail and recklessness.
The US Dollar has somewhat strengthened its positions over the period of January 14-18 as the financial instruments, sensitive to the economic growth, were correlating after a rampant growth over the past week. The macroeconomic data which came over this period signaled a further growth of the world’s largest economy. The retail sales data proved better than the expectations and the inflation numbers meanwhile meet the forecasted USFR expectations. Some members of the Open Markets Committee have optimistically assessed the American economy’s prospects for the first half of 2013 in their public speeches this week, which will positively impact the market. Chances for the third round of the quantitative easing being lengthy are diminishing.
Over the period of January 14-18, a whole package of significant macroeconomic data will be published in the US, which can influence the traders’ mood. Besides that, the Federal Reserve President Ben Bernanke will deliver a speech at the University of Michigan (January 14, 21:00 GMT) on the monetary policy and the particulars of the American economy’s recovery following the financial crisis.