The following table lists the key economic data and other events that came out during the week of September 19th through September 23rd, 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, September 19th
All Day JPY Bank Holiday
Tuesday, September 20th
2:30am AUD Monetary Policy Meeting Minutes noted that,
The cost of borrowing US dollars in short-term money markets had risen further over the past month, ahead of the implementation of US money market reforms in October. The cost of borrowing US dollars in exchange for yen and some other currencies in short-term foreign exchange swap markets had also remained elevated. This appeared to reflect strong demand from Japanese investors and banks as they searched for yield in light of the BoJ's quantitative easing measures. The profitability of lending Australian dollar securities for cash, swapping the proceeds into yen and purchasing Japanese government bonds had pushed Australian short-term secured lending rates higher.
The currency rose.
2:30am AUD HPI 2.0% versus 3.1% expected. The currency rose.
1:30pm USD Building Permits 1.14M versus 1.17M expected. The currency rose.
1:30pm USD Housing Starts 1.14M versus 1.19M expected. The currency rose.
3:08pm NZD GDT Price Index 1.7% versus last 7.7%. The currency rose.
5:50pm CAD BOC Governor Poloz said that,
In our most recent Monetary Policy Report, in July, we said that our current policy rate setting of 0.5 per cent was consistent with the economy returning to full capacity toward the end of 2017 and inflation returning sustainably to its target. We’ll update our forecast next month, but in our decision on September 7, we indicated that the risks to our projected inflation profile have tilted somewhat to the downside following recent data on investment in both the United States and Canada, and the recent data on our exports. It is quite evident that our economy is still facing strong headwinds, and we need stimulative monetary policy to counteract them and move us closer to full capacity. We also need to watch the full effects of the government’s fiscal stimulus unfold.
The currency rose.
Wednesday, September 21st
5:18am JPY BOJ Policy Rate -0.10% versus -0.20% expected. The currency rose.
5:18am JPY Monetary Policy Statement noted that,
The short-term policy interest rate: The Bank will apply a negative interest rate of minus 0.1 percent to the Policy-Rate Balances in current accounts held by financial institutions at the Bank. The long-term interest rate: The Bank will purchase Japanese government bonds (JGBs) so that 10-Year JGB yields will remain more or less at the current level (around zero percent). With regard to the amount of JGBs to be purchased, the Bank will conduct purchases more or less in line with the current pace -- an annual pace of increase in the amount outstanding of its JGB holdings at about 80 trillion yen -- aiming to achieve the target level of a long-term interest rate specified by the guideline.” The currency rose.
7:30am JPY BOJ Press Conference, Governor Haruhiko Kuroda noted that,
We will ease further when necessary. We can cut short-term rates, lower the long-term rate target, buy more assets or if conditions warrant, accelerate the pace of expansion in monetary base. There's room to ease further with the three dimensions of quantity and quality of assets as well as interest rates.
The currency rose.
9:30am GBP Public Sector Net Borrowing 10.1B versus 10.5B expected. The currency rose.
1:30pm CAD Wholesale Sales 0.3% versus 0.3% expected. The currency rose.
3:30pm USD Crude Oil Inventories -6.2M versus 3.2M expected. The currency fell.
7:00pm USD FOMC Economic Projections noted that,
The June projections were made in conjunction with the meeting of the Federal Open Market Committee on June 14-15, 2016. One participant did not submit longer-run projections in conjunction with the June 14-15, 2016, meeting. For the September 20-21, 2016, meeting, one participant did not submit longer-run projections for the change in real GDP, the unemployment rate, or the federal funds rate.
The currency fell.
7:00pm USD FOMC Statement noted that,
The Committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives. The stance of monetary policy remains accommodative, thereby supporting further improvement in labor market conditions and a return to 2 percent inflation.
The currency fell.
7:00pm USD Federal Funds Rate
7:30pm USD FOMC Press Conference, Fed Chair Janet Yellen noted that,
Our decision does not reflect a lack of confidence in the economy. Conditions in the labor market are strengthening and we expect that to continue. While inflation remains low we expect it to rise toward the 2 percent objective over time. But with labor market slack being taken up at a somewhat slower pace than in previous years, scope for some further improvement in the labor market remaining and inflation continuing to run below our 2 percent target, we chose to wait for further evidence of continued progress toward our objectives.
The currency fell.
10:00pm NZD Official Cash Rate 2.00% versus 2.00% expected. The currency rose.
10:00pm NZD RBNZ Rate Statement noted that,
Weak global conditions and low interest rates relative to New Zealand are placing upward pressure on the New Zealand dollar exchange rate. The trade-weighted exchange rate is higher than assumed in the August Statement. Although this may partly reflect improved export prices, the high exchange rate continues to place pressure on the export and import-competing sectors and, together with low global inflation, is causing negative inflation in the tradables sector. A decline in the exchange rate is needed.
The currency rose.
Thursday, September 22nd
1:00am AUD RBA Governor Lowe said that,
Some central banks have taken extraordinary actions, including large-scale money creation and setting negative policy interest rates. This has had global ramifications. While these actions have generally not been taken with the direct intention of influencing exchange rates, they have, inevitably, affected international capital flows and exchange rates. We have seen the effects here in Australia. The monetary expansion elsewhere and the low rates on offer overseas have meant that foreign investors have found Australian assets, with their relatively higher returns, attractive. In this way, what is happening elsewhere affects us here in Australia.
The currency rose.
All Day JPY Bank Holiday
10:30am EUR Long Term Refinancing Option 45.3B versus last 399.3B. The currency rose.
1:00pm GBP MPC Member Forbes said that,
Reducing bank leverage and strengthening banking systems can significantly limit a country’s vulnerability to contagion and shocks that originate elsewhere. These steps can not only reduce contagion, but also reduce domestic risks and risks related to international capital flows. Simulations suggest that the impact of stronger bank regulation and tighter leverage requirements on reducing the likelihood of banking crises and the negative effects when banks do get into difficulty can be substantial.
The currency rose.
1:30pm USD Weekly Initial Jobless Claims 252K versus 261K expected. The currency fell.
2:00pm EUR ECB President Draghi said that,
One policy under consideration is the macroprudential use of margin and haircut requirements. Setting margins and haircuts in a conservative or countercyclical manner may help to contain the excessive build-up of leverage. In addition to “leaning against the wind”, margin and haircut requirements can also improve financial stability by mitigating illiquidity spirals. This is particularly important given that an imbalance between the demand for and supply of liquidity could amplify or transmit shocks through the financial system.
The currency rose.
3:00pm USD Existing Home Sales 5.33M versus 5.45M expected. The currency fell.
6:10pm GBP BOE Governor Carney said that,
Long-run prosperity was never in the gift of monetary policy makers. As the 10th anniversary of the start of the crisis approaches, a consensus is growing that escaping this low-growth low-inflation trap will require a rebalancing between monetary, fiscal and structural policies. The last are the most important. In addition to their merits in raising potential growth directly, structural reforms could improve the savings and investment balance, thereby increasing equilibrium interest rates and giving monetary policy more traction.
The currency rose.
Friday, September 23rd
8:00am EUR French Flash Manufacturing PMI 49.5 versus 48.4 expected. The currency rose.
8:00am EUR French Flash Services PMI 54.1 versus 52.0 expected. The currency rose.
8:30am EUR German Flash Manufacturing PMI 54.3 versus 53.2 expected. The currency rose.
8:30am EUR German Flash Services PMI 50.6 versus 52.2 expected. The currency rose.
9:00am EUR Flash Manufacturing PMI 52.6 versus 51.5 expected. The currency rose.
9:00am EUR Flash Services PMI 52.1 versus 52.8 expected. The currency rose.
1:30pm CAD Core CPI 0.0% versus expected 0.2%. The currency fell.
1:30pm CAD Core Retail Sales -0.1% versus +0.5% expected. The currency fell.
1:30pm CAD CPI -0.2% versus +0.1% expected. The currency fell.
1:30pm CAD Retail Sales -0.1% versus +0.2% expected. The currency fell.
Saturday, September 24th
3:00pm NZD Daylight Saving Time Shift
Technical Recap for the Majors This Week
EUR/USD: Lower
Resistance:
Forecast: Lower
Actual: Higher from a 1.11518 open to a 1.12196 close.
USD/JPY: Lower
Resistance:
Forecast: Higher
Actual: Lower from a 102.127 open to 100.710 close.
GBP/USD: Lower
Resistance:
Forecast: Lower
. Actual: Mildly lower from a 1.29979 open to a 1.29716 close.
AUD/USD: Lower
Resistance:
Forecast: Lower.
Actual: Higher from a 0.74769 open to 0.76366 close.
USD/CAD: Lower
Resistance:
Forecast: Mildly higher. Actual: Lower from a 1.32147 open to a 1.30398 close.
NZD/USD: Lower
Resistance:
Forecast: Lower
. Actual: Mildly higher from a 0.72547 open to a 0.72650 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.