Review of the main events of the Forex economic calendar for the next trading week (27.09.2021 – 03.10.2021)
Having received support from the sharply increased US government bond yields, the dollar closed last week with a slight gain. The DXY dollar index reflecting the value of the dollar against a basket of 6 major currencies added 0.14% last week. The growth of the dollar was constrained by disagreements among the Fed leaders over the future plans of the central bank’s monetary policy.
Based on the forecasts presented last Wednesday at the Fed meeting, only half of its leaders believe that by the end of 2023, rates will need to be raised by 1 percentage point from current levels and by another three quarters of a percentage point in 2024.
The other half of the Fed officials called for even greater caution in raising rates, pointing to the risks associated with an increase in the number of cases of Covid-19, which could lead to another round of economic recession and a slowdown in the recovery of the labor market.
The American economy has created an estimated 4.7 million jobs to date, less than half of those lost since the start of the pandemic, when 10 million Americans lost their jobs. Also, most Fed leaders believe that inflation will slow to 2.3% in 2022 and to 2.2% in 2023.
Since the full recovery of the American labor market is still far away, judging by the latest data, the prospect of an increase in interest rates by the Fed may also move again to a later date, despite the official statement of the Federal Open Market Committee (FOMC), according to which the slowdown in asset purchases may be announced at the next meeting, which will take place on November 2-3.
At the same time, optimism seems to be returning to global stock exchanges.
So, following the results of a very volatile trading week, the main American stock indices closed it in positive territory with a small gain.
Next week will be transitional between September and October, as well as between the 3rd and 4th quarters of the year, and financial market participants will pay attention to the publication of important macro statistics from the US, Germany, Eurozone, Australia, China, the UK, and Canada.
*during the coming week, new events may be added to the calendar and / or some scheduled events may be canceled
Monday, September 27
12:30 USD Durable goods orders. Capital goods orders (ex defense and aviation)
This indicator reflects the value of orders received by manufacturers of durable goods and capital goods (capital goods are durable commodities used to produce durable goods and services), involving large investments. Commodities produced in the defense and aviation sectors of the US economy are not included in this indicator. A strong result strengthens the USD. Previous values of the indicator “durable goods orders”: -0.1% in July, +0.9% in June, +2.3% in May, -1.3% in April, +1% in March, -1.2% in February, +3.4% in January 2021.
Previous values of the indicator “capital goods orders ex defense and aviation”: 0% in July, +0.7% in June, +0.1% in May, +2.2% in April, +1% in March, -0.9% in February, +0.6% in January 2021.
In theory, the relative growth of the indicator has a positive effect on the dollar; the market reaction to its negative value may be negative for the dollar in the short term. Data worse than the previous value will also negatively affect the dollar quotes.
Forecast for August: +0.6% (durable goods orders), + 0.5% (capital goods orders ex defense and aviation).
It seems that the growth of indicators has slowed down,…