THE NAGA GROUP AG U.S Goods and Services Trade Balance, BoC's Governor Macklem speech, U.K Gross Domestic Product (QoQ), and more - another big week ahead Let's take a look!
US Goods and Services Trade Balance - (Tuesday, February 08)
The US Goods and Services Trade Balance will be released at 13:30 GMT on Tuesday, February 8th. The Bureau of Economic Analysis and the US Census Bureau released the Goods and Services Trade Balance, which is a balance between total goods and services exports and imports.
A positive number indicates a trade surplus, whereas a negative number indicates a trade deficit. The USD will experience some volatility as a result of this incident. If there is consistent demand for US exports, the trade balance will improve, which will be beneficial to the USD.
Watch out for the EUR/USD.
CAD - BoC's Governor Macklem speech - (Wednesday, February 09)
Tiff Macklem was named Governor of the Bank of Canada on June 3, 2020, with an effective date of June 3, 2020. He is also Chairman of the Bank's Board of Directors as Governor. Macklem was Dean of the Rotman School of Management at the University of Toronto for six years before being named BoC chief. He had previously served as the Bank of Canada's Senior Deputy Governor from July 2010 to May 2014. He was also the first chair of the Financial Stability Board's Standing Committee for Standards Implementation, which he led from 2009 to 2013.
Macklem was also the Bank of Canada's representative at the FSB from 2009 to 2013. He has greater power over the nation's currency value than anybody else as the head of the central bank, which regulates short-term interest rates. Traders pay close attention to his public appearances since they frequently deliver subtle hints about future monetary policy. It's beneficial to the currency if the Fed is more hawkish than predicted.
Watch out for the USD/CAD.
US Consumer Price Index (MoM) - (Thursday, February 10)
The annual inflation rate in the United States accelerated to 7% in December 2021, a new high since June 1982, and compared to 6.8 percent in November. The figures were consistent with market expectations. Inflation soared in 2022 as a result of pandemic-induced supply constraints, skyrocketing energy costs, labor shortages, rising demand, and a low base effect from 2020. Inflationary pressures are expected to last until the middle of 2022, and Fed Chair Powell recently pledged to do whatever it takes to keep inflation under control, including raising interest rates.
A high CPI reading increases the likelihood that the Fed will make policy changes at its next meeting sooner rather than later, strengthening the dollar.
Watch out for the EUR/USD and other pairs with the U.S. Dollar.
UK Gross Domestic Product (QoQ) - (Friday, February 11)
On Friday, February 11th, at 07:00 GMT, the UK Gross Domestic Product (QoQ) will be released. The National Statistics' Gross Domestic Product is a measure of the total value of all products and services generated in the United Kingdom. The GDP is a broad indicator of economic activity in the United Kingdom. In general, a rising trend is considered favorable for the GBP, but a declining trend is considered negative (or bearish).
By increasing rates for the second time in a row in February, the Bank of England maintained its lead over other major central banks in terms of being the least behind the curve on inflation. Despite the meeting's overall hawkish tone, Governor Andrew Bailey pointed out potential negative risks to the Fed's recently revised inflation predictions, raising doubts about the rating outlook even as he predicted additional rate hikes in future sessions.
So, while sterling is well supported following the Bank of England meeting, it may require a new positive impetus to maintain its recovery versus the greenback. It's unlikely that next week's quarterly GDP report will serve as that catalyst. According to data released on Friday, the UK economy is expected to have recovered all of its lost productivity from the pandemic in the three months leading up to December.
Watch out for the GBP/USD.
That's it for this week, happy trading!
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NAGA Group AG published this content on 07 February 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 08 February 2022 09:31:01 UTC.
