Key Fundamental Forex Events for the Week of March 7th through March 11th
The following table lists the key economic data and other events that came out during the week of March 7th through March 11th, with release times displayed for the GMT time zone.
The list also indicates how much each release deviated from the market consensus forecast upon release, as well as what the affected major currency pair or pairs did after each event or set of events.
Monday, March 7th
3:40am JPY BOJ Governor Kuroda said that, “The decline in yen interest rates and the fact that further monetary easing is possible - all else being equal - have a positive impact on asset prices. At the moment, these effects are being outweighed by excessive risk aversion among investors around the globe. Now is the time to carefully scrutinize how the effect (of the negative rate policy) will spread to the economy”. The currency rose.
7:00am EUR German Factory Orders -0.1% versus -0.4% expected. The currency rose.
8:00am CHF Foreign Currency Reserves 571B versus last 575B. The currency rose.
9:10am GBP MPC Member Haldane said that “Is there an industrial revolution in financial services? Finance is a market in information – information technology should matter!” The currency rose.
All Day EUR Eurogroup Meetings
6:00pm USD FOMC Member Brainard said that, “Given the currently weak relationship between economic slack and inflation and the persistent, depressing effects of energy price declines and exchange rate increases, we should be cautious in assessing that a tightening labor market will soon move inflation back to 2 percent.” The currency fell.
6:00pm USD FOMC Member Fischer said that, “The answer to the question “Will the equilibrium interest rate remain at today's low levels permanently?" is also that we do not know. Many of the factors that determine the equilibrium interest rate, particularly productivity growth, are extremely difficult to forecast. At present, it looks likely that the equilibrium interest rate will remain low for the policy-relevant future, but there have in the past been both long swings and short-term changes in what can be thought of as equilibrium real rates.” The currency fell.
11:20pm AUD RBA Deputy Governor Lowe said that, “For us, here in Australia, the continuing low wages growth means that CPI inflation is also likely to remain relatively low. While there is some upward pressure on the retail prices of imported goods as a result of the depreciation, this pressure is being muted by stronger competition following the entry of a number of overseas-based retailers into the Australian market. As the Reserve Bank has indicated for some time, this low inflation outlook provides scope for easier monetary policy should that be appropriate in supporting demand growth in the economy.” The currency rose.
11:50pm JPY Current Account 1.49T versus 1.66T expected. The currency rose.
11:50pm JPY Final GDP -0.3% versus -0.4% expected. The currency rose.
Tuesday, March 8th
12:30am AUD NAB Business Confidence 3 versus last 3. The currency fell.
2:36am CNY Trade Balance 210B versus 339B expected.
9:15am GBP BOE Governor Carney told the Commons Treasury Committee on Britain exiting the EU that, “I’m saying it is the biggest domestic risk to financial stability. I would say that, in my judgment, the global risks, including from China, are bigger than the domestic risk.” And that, “An adjustment in sterling, a notable depreciation of sterling, if that were to occur associated with the decision to leave, creates a challenge, not an insurmountable challenge, but a challenge for the monetary policy committee ... That level adjustment, and the pass-through that would come from a lower exchange rate, would be considerable and influence the stance of monetary policy.” The currency fell.
All Day EUR ECOFIN Meetings noted that, “On 8 March 2016, the Council agreed its stance, pending the European Parliament's opinion, on a draft directive on the exchange of tax-related information on the activities of multinational companies. The United Kingdom strongly supported this stance pending consultation of its parliament. The directive will implement, at EU level, an OECD recommendation requiring multinationals to report tax-related information, detailed country-by-country, and requiring national tax authorities to exchange that information automatically.” The currency fell.
1:30pm CAD Building Permits -9.8% versus -2.2% expected. The currency fell.
5:00pm GBP MPC Member Weale said that, “as far as I can see, it is appreciably more likely that monetary tightening rather than monetary easing will be needed in the United Kingdom over the next two years.” And that, “Nevertheless, should the need for further easing arise because of a sharp weakening in the outlook for inflation, the scope for further asset purchases is substantial, while the obstacles we saw to reducing Bank Rate below ½ per cent are no longer material.” The currency fell.
11:30pm AUD Westpac Consumer Sentiment -2.2% versus last 4.2%. The currency fell.
Wednesday, March 9th
12:30am AUD Home Loans -3.9% versus -2.7% expected. The currency rose.
9:30am GBP Manufacturing Production 0.7% versus 0.2% expected. The currency rose.
3:00pm CAD BOC Rate Statement noted that, “Prices of oil and other commodities have rebounded in recent weeks. In this context, and in light of shifting expectations for monetary policy in Canada and the United States, the Canadian dollar has appreciated from its recent lows. With these movements, both the price of oil and the exchange rate have averaged close to levels assumed in the January MPR. Canada’s GDP growth in the fourth quarter was not as weak as expected, but the near-term outlook for the economy remains broadly the same as in January. National employment has held up despite job losses in resource-intensive regions, and household spending continues to underpin domestic demand.” The currency rose.
3:00pm CAD Overnight Rate 0.50% versus 0.50% expected, . The currency rose.
3:30pm USD Crude Oil Inventories 3.9M versus 3.0M expected. The currency fell.
8:00pm NZD Official Cash Rate 2.25% versus 2.50% expected. The currency fell.
8:00pm NZD RBNZ Rate Statement noted that, “Headline inflation is expected to move higher over 2016, but take longer to reach the target range. Monetary policy will continue to be accommodative. Further policy easing may be required to ensure that future average inflation settles near the middle of the target range. We will continue to watch closely the emerging flow of economic data.” The currency fell.
8:00pm NZD RBNZ Monetary Policy Statement noted that, “The outlook for global growth has deteriorated since the December Monetary Policy Statement, due to weaker growth in China and other emerging markets, and slower growth in Europe. This is despite extraordinary monetary accommodation, and further declines in interest rates in several countries. Financial market volatility has increased, reflected in higher credit spreads. Commodity prices remain low.” The currency fell.
11:10pm NZD RBNZ Governor Wheeler said that, “Headline inflation is expected to move higher over 2016, but take longer to reach the target range. Further policy easing may be required to ensure that future average inflation settles near the middle of the target range.” The currency fell.
Thursday, March 10th
1:30am CNY CPI 2.3% versus 1.8% expected.
1:30am CNY PPI -4.9% versus -4.9% expected.
12:45pm EUR Minimum Bid Rate 0.00% versus 0.05% expected. The currency rose.
1:30pm CAD NHPI 0.1% versus 0.2% expected. The currency fell.
1:30pm EUR ECB Press Conference, ECB President Draghi said that, “First, as regards the key ECB interest rates, we decided to lower the interest rate on the main refinancing operations of the Eurosystem by 5 basis points to 0.00% and the rate on the marginal lending facility by 5 basis points to 0.25%. The rate on the deposit facility was lowered by 10 basis points to -0.40%. Second, we decided to expand the monthly purchases under our asset purchase programme from €60 billion at present to €80 billion. They are intended to run until the end of March 2017, or beyond, if necessary, and in any case until the Governing Council sees a sustained adjustment in the path of inflation consistent with its aim of achieving inflation rates below, but close to, 2% over the medium term.” The currency rose.
1:30pm USD Weekly Initial Jobless Claims 259K versus 272K expected. The currency fell.
11:50pm JPY BSI Manufacturing Index -7.9 versus 4.2 expected. The currency rose.
Friday, March 11th
9:30am GBP Trade Balance -10.3B versus -10.3B expected. The currency rose.
1:30pm CAD Employment Change -2.3K versus +10.2K expected. The currency fell.
1:30pm CAD Unemployment Rate 7.3% versus 7.2% expected. The currency fell.
1:30pm USD Import Prices -0.3% versus -0.7% expected. The currency rose.
Saturday, March 12th
5:30am CNY Industrial Production 5.6% expected versus last 5.9%.
5:30am CNY Fixed Asset Investment 9.5% expected versus last 10.0%.
Technical Recap for the Majors This Week
EUR/USD:
Forecast: Lower
Actual: Higher from a 1.09866 open to a 1.11851 close.
USD/JPY:
Forecast: Mildly lower
Actual: Mildly lower from a 113.908 open to 113.654 close.
GBP/USD:
Forecast: Lower
Actual: Higher from a 1.42140 open to a 1.44251 close.
AUD/USD:
Forecast: Mildly higher
Actual: Higher from a 0.73995 open to 0.75726 close.
USD/CAD:
Forecast: Lower
Actual: Lower from a 1.33281 open to a 1.31993 close.
NZD/USD:
Forecast: Higher
Actual: Mildly lower from a 0.67796 open to a 0.67632 close.
Risk Statement: Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors. The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.