The past week was marked by the strengthening of the dollar over the financial market. A series of terrorist attacks in Belgium provoked a decline in the euro and the EUR / USD at the beginning of the week. Emerging developments in the euro area in connection with the migration situation strengthen the position of the centrifugal forces, which also have a negative impact on the euro quotes.
The limiting factor of the strong reduction of the EUR / USD is the recent decision by the Federal Reserve on interest rates and the subsequent comments about future monetary policy plans in the United States.
Now, reinforces the view of a possible increase in US interest rates in April, market participants will put pressure on the EUR / USD pair and support the dollar in the financial market until the Fed meeting in late April.
The US dollar received support from both the aggravated situation in the euro area against the background of the migration situation and a series of explosions in Belgium, and on the statements of some key figures on the Fed last week. So, Philadelphia Fed President Patrick Harker said the positive outlook of the US economy speak in favor of the next increase of short-term interest rates. Moreover, the rate hike is possible in any of the Fed meeting, not excluding April.
The apotheosis was an interview with Bloomberg Television, the president of the Federal Reserve of St. Louis James Bullard, in which he stated that it is likely the April rise in interest rates in the US, if the economic data will continue to match the Fed's forecasts.
That came out on Friday the third estimate of US GDP growth in Q4 was revised upwards from 1% to 1.4%.
Tuesday.
It is worth paying attention to the performance of FOMC Member Williams. In the published level of consumer confidence for March in the United States. the growth rate is expected to 94.0 versus 92.2 in February, causing a rise in the dollar at the confirmation of the forecast.
Wednesday.
- Preliminary data on consumer price indices in Germany in March.
- Changes in the number of employees in the United States (on employment report from ADP) in March. As a rule, it has a strong impact on the market and the dollar quotes because it is a kind of preliminary index published later on Friday Non-Farm Payrolls. Strong data a positive impact on the dollar.
Thursday.
- Data on unemployment in Germany in March.
- Block macroeconomic data for the UK in February, as well as UK GDP for the 4th quarter.
- Preliminary index of consumer prices in the euro area in March. The growth index will support the euro.
- Data from the last meeting of the ECB's monetary policy with an overview of the changes and plans in the financial, economic and monetary policy of the euro area.
Friday.
- Tankan index from the Bank of Japan's key sectors of the economy in the 1st quarter. Strong data will cause growth of the index Nikkei Stock Average and the pair USD / JPY.
- Indexes of business activity in the service sector and the manufacturing sector of China's economy in March. Negative data will cause the fall of the Chinese stock market indices that can pull in a decrease in other Asian markets, and the opening in negative territory in European stock indices in the European session, which may be accompanied by a strengthening of the euro, as well as lower commodity currencies quotations, such as the Australian, New Zealand, Canadian dollars.
Positive indexes will cause a reverse reaction of the market.
- Key news of Friday and the week, which will also have an impact on the market before the end of April - the number of new jobs created in the not / x US sector of the economy (Non-Farm PayRolls) in March (forecast of 205 000 new jobs against 242 000 in February), as well as data on the level of unemployment in the US (forecast 4.9% vs. 4.9% in the previous month).
- The most important indices: PMI Markit manufacturing sector, consumer confidence, gradual acceleration of inflation, the ISM business activity in the manufacturing sector of the US economy in March.
Investors will closely monitor Friday's data from the US, because they will give the foundation to build a forecast of the interest rate increase in the United States in April and later in the framework of the Fed's plans. Positive data strengthen the view of market participants for such an increase rates. Negative data will cause the collapse of the US dollar on the financial market.
The limiting factor of the strong reduction of the EUR / USD is the recent decision by the Federal Reserve on interest rates and the subsequent comments about future monetary policy plans in the United States.
Now, reinforces the view of a possible increase in US interest rates in April, market participants will put pressure on the EUR / USD pair and support the dollar in the financial market until the Fed meeting in late April.
The US dollar received support from both the aggravated situation in the euro area against the background of the migration situation and a series of explosions in Belgium, and on the statements of some key figures on the Fed last week. So, Philadelphia Fed President Patrick Harker said the positive outlook of the US economy speak in favor of the next increase of short-term interest rates. Moreover, the rate hike is possible in any of the Fed meeting, not excluding April.
The apotheosis was an interview with Bloomberg Television, the president of the Federal Reserve of St. Louis James Bullard, in which he stated that it is likely the April rise in interest rates in the US, if the economic data will continue to match the Fed's forecasts.
That came out on Friday the third estimate of US GDP growth in Q4 was revised upwards from 1% to 1.4%.
Tuesday.It is worth paying attention to the performance of FOMC Member Williams. In the published level of consumer confidence for March in the United States. the growth rate is expected to 94.0 versus 92.2 in February, causing a rise in the dollar at the confirmation of the forecast.
Wednesday.
- Preliminary data on consumer price indices in Germany in March.
- Changes in the number of employees in the United States (on employment report from ADP) in March. As a rule, it has a strong impact on the market and the dollar quotes because it is a kind of preliminary index published later on Friday Non-Farm Payrolls. Strong data a positive impact on the dollar.
Thursday.
- Data on unemployment in Germany in March.
- Block macroeconomic data for the UK in February, as well as UK GDP for the 4th quarter.
- Preliminary index of consumer prices in the euro area in March. The growth index will support the euro.
- Data from the last meeting of the ECB's monetary policy with an overview of the changes and plans in the financial, economic and monetary policy of the euro area.
Friday.
- Tankan index from the Bank of Japan's key sectors of the economy in the 1st quarter. Strong data will cause growth of the index Nikkei Stock Average and the pair USD / JPY.
- Indexes of business activity in the service sector and the manufacturing sector of China's economy in March. Negative data will cause the fall of the Chinese stock market indices that can pull in a decrease in other Asian markets, and the opening in negative territory in European stock indices in the European session, which may be accompanied by a strengthening of the euro, as well as lower commodity currencies quotations, such as the Australian, New Zealand, Canadian dollars.
Positive indexes will cause a reverse reaction of the market.
- Key news of Friday and the week, which will also have an impact on the market before the end of April - the number of new jobs created in the not / x US sector of the economy (Non-Farm PayRolls) in March (forecast of 205 000 new jobs against 242 000 in February), as well as data on the level of unemployment in the US (forecast 4.9% vs. 4.9% in the previous month).
- The most important indices: PMI Markit manufacturing sector, consumer confidence, gradual acceleration of inflation, the ISM business activity in the manufacturing sector of the US economy in March.
Investors will closely monitor Friday's data from the US, because they will give the foundation to build a forecast of the interest rate increase in the United States in April and later in the framework of the Fed's plans. Positive data strengthen the view of market participants for such an increase rates. Negative data will cause the collapse of the US dollar on the financial market.
