THIS WEEK’S INDICATORS

The US Dollar has finally managed to recover from last week’s 6-Month low, backed on an anticipated hawkish rate hike in June. Investors turned into buying USD as a build-up to the NFP, Consumer Confidence and inflation data that are expected during next month.

The EURUSD pair closed 0.26% lower despite a temporary boost on Merkel’s comment for a weak Euro, whilst Yen closed stronger against the Dollar on positive Asia data as China’s credit rating downgrade hasn’t been completely played out.

On other major pairs, Sterling was the worst performer as it traded 1.1% lower amid increasing political risk whilst EURGBP strengthened up 0.82% to 0.8732. CAD has been optimistic and alongside OPEC’s decision to extend the production cut, the Loonie closed 0.30 higher against the Dollar, meanwhile Oil plunged below $50/b as investors expected a longer extension.

MONDAY

Monday is relatively quiet as UK and US markets are closed. ECB President Draghi is expected to talk on Monetary Policy.

Today, Draghi will testify on economic and monetary developments as such volatility could be expected during his speech, creating the ground for possible opportunities for market participants.

TUESDAY

On Tuesday, some volatility is expected on inflationary data coming from the US and NZ. The Core PCE Price index will be released, Fed’s favorite measure of inflation, followed by the Consumer Confidence.

Previous data showed a deceleration of inflation and a reduction in confidence.

The RBoNZ Financial Stability Report may affect the interest rates in the future hence the Bank’s view on inflation could be anticipated by investors to enter possible trades.

WEDNESDAY

A volatile Wednesday for Europe and Canada on economic and inflationary data releases.

In Europe, inflation figures are expected to drop to 1% on Wednesday while Canada releases its monthly GDP data. BoC reported a flat economy in February and expectations for April stand to 0.3%.

Actual data could have some impact in the markets as volatility has proven to be high during the release.

Investors may keep an eye on the numbers for possible set-ups.

THURSDAY

The second most volatile day of the week this Thursday, as Australia, the UK and US are going to release important economic data.

Australia will release data on Private Capital Expenditure and Retail Sales, the UK will release Manufacturing PMI data and the US the ADP report on employed people, the weekly report on Unemployment Claims and the ISM Manufacturing PMI.

The EIA will also release the weekly Crude Inventories numbers.

Oil was in a week of focus last week with significant volatility noted around the OPEC meeting last Thursday.

Traders may pay attention to the inventory numbers in an attempt to anticipate the impact on US Dollar, the Oil itself and the Canadian and Australian Dollars.

FRIDAY

Friday is the day all investors and traders have been waiting for the whole month; the Non-Farm Payroll report.

Despite UK and Cad releases on Construction PMI and Trade Balance respectively, this Friday’s highlight will be the NFP report release.

Investors may consider the importance of this NFP release as it could be the trigger for Fed’s decision on interest rate hike in June, hence it could provide insights for both immediate and future opportunities.

Market participants may pay attention to the employment change as well as the unemployment rates numbers to find possible take profit levels.

MARKET MOVERS SUMMARY

This coming Friday there would be a very important economic release; the NFP report is expected to be released on the 2nd of June.

Last month’s NFP data were mixed and confused market participants.

On Thursday, traders can look at the Aussie, UK and US growth data to pursue opportunities offered in the market.

Europe, and Canada could be investors’ focus during quieter Wednesday’s session, whilst Tuesday and Monday could provide the needed volatility for a few good set-ups around the release of US and NZ data as well as during president Draghi’s testimony respectively.

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