Review of the main events of the Forex economic calendar for the next trading week (02.08.2021 – 08.08.2021)
While the major US stock indices ended the last week mostly neutral, the dollar fell. At the end of the trading day on Friday the DXY dollar index was 1% below its opening price at the beginning of the week.
Last Wednesday, the Fed officials kept the current parameters of monetary policy unchanged, signaling the need to further support the economy and continue stimulating measures. “Against the backdrop of progress in vaccination of the population and strong government support measures, indicators of economic activity and employment continue to grow stronger. The sectors most affected by the pandemic have shown some improvement, but have not yet fully recovered,” the central bank said.
Still, we probably should not be expecting a stronger decline in the dollar. One way or another, the US economy is recovering faster than other major world economies, maybe except China.
At the same time, the growing inflation in the United States, which shows the highest growth rates over the past almost 30 years, will sooner or later force the Fed leaders to pay attention to this and still start curtailing the stimulating policy. Most economists believe that the Fed will start this process earlier than, for example, the ECB. And this is one of the main reasons to give preference to the dollar.
It is also in demand as a defensive asset amid fears about the spread of the coronavirus, and continued positive macro data from the US provide additional support.
Next week, financial market participants will pay attention to the publication of important macro statistics from Germany, the US, New Zealand, Australia, the Eurozone, Canada, as well as the results of the meetings of the central banks of Australia and the UK. However, the focus of their attention will still be the publication on Friday of monthly data from the US labor market.
*during the coming week, new events may be added to the calendar and / or some scheduled events may be canceled
Monday, August 2
06:00 EUR Retail Sales in Germany
Retail sales is the main indicator of consumer spending in Germany, showing changes in retail sales. A high result strengthens the euro, and vice versa, a low result weakens it. Forecast: +2% in June against +4.2% (-2.4% y / y) in May, -2.0% (+4.4% y / y) in April, +7.7% ( +11% y / y) in March, +1.2% (-9.0% y / y) in February, -4.5% (-8.7% y / y) in January.
The data indicate the instability of the recovery of this sector of the German economy due to lockdowns. Better-than-expected data is likely to have a positive effect on the euro, but in the short term.
14:00 USD Manufacturing PMI (from ISM)
Published by the Institute for Supply Management (ISM), the US Manufacturing PMI is an important indicator of the health of the US economy as a whole. A result above 50 is seen as positive and strengthens the USD, one below 50 as negative for the US dollar. Forecast: 60.8 in July (against 60.6 in June, 61.2 in May, 60.7 in April, 64.7 in March, 60.8 in February, 58.7 in January, 60.7 in December). The index is above the 50 level and has a relatively high value, which is likely to support the dollar. The data above the value of 50 indicates an acceleration of activity, which has a positive effect on the quotes of the national currency. If the indicator falls below the forecast and, especially, below the value of 50, the dollar may sharply weaken in the short term.
Tuesday, August 3
04:30 AUD RBA’s decision on interest rate. RBA’s accompanying statement