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Weekly Market Forecast: GBP and AUD Awaiting BoE and RBA Speeches

20 February 2017 by News Desk

Central bank speeches and Brexit developments may dominate the market this week with only a trickle of high-priority data due to make its way onto the scene, say currency specialists FC Exchange.

Australian Dollar (AUD) Exchange Rate Forecast for Movement on RBA Lowe Comments

The Aussie dollar could be in for some volatility this week due to central bank developments. The Reserve Bank of Australia (RBA) is expected to release its February meeting minutes on Tuesday which could catalyse some AUD market movement. Meanwhile, Wednesday will see RBA Governor Phillip Lowe make a speech in Sydney which may be an excuse for market shifts. Chief Lowe will also be in the spotlight on Friday where he will make a testimony to the Parliament Committee.

Thursday will bring with it Australian Private Capital Expenditure data which could alter the AUD exchange rate moderately.

Pound Sterling Exchange Rate Prediction: GBP Awaiting BoE Carney Speech

This week could be an interesting one for investors in the pound with a few events scheduled that could instigate market movement. Tuesday will see Bank of England (BoE) Governor Mark Carney speak in Parliament which may cause some substantial sterling fluctuations. Additionally, any developments in politics and Britain’s exit from the EU could play a large part in sterling strengthening or softening.

Wednesday will be another big day for the UK currency with the release of British gross domestic product (GDP) data. Economists are expecting the Q4 figure to remain at 2.2%, but any deviation from forecasts could encourage pound sterling exchange rate movement.

US Dollar (USD) Exchange Rate Forecast for Movement on FOMC Minutes

The US dollar’s most significant day this week is likely to be Wednesday when the Federal Open Market Committee (FOMC) releases its February meeting minutes. Any hawkish comments could lead the way to greenback strengthening. There are a few Federal Reserve representatives speaking at various events throughout the week which could also cause some USD exchange rate changes.

In terms of data, there are several pieces that may prove to be moderately influential due to be published this week. Tuesday’s trading will bring with it the release of the Markit manufacturing and services purchasing managers’ indexes (PMI) which have been forecast to increase. Any figure above 50.0 denotes expansion and so the higher the number, the more positively the economy’s performance.

Euro (EUR) Exchange Rate Forecast for the Week Ahead

Those interested in the euro exchange rate will want to pay close attention on Wednesday as the market is likely to react to the release of the Eurozone consumer price index (CPI). The January reading is expected to contract by -0.8% on the month following December’s +0.5%, while the annual figure is predicted to remain at 1.8%.

Looming French elections are expected to play havoc with the EUR exchange rate in coming months as political parties fight it out. If Marine Le Pen wins French citizens will be allowed to vote in their own EU referendum which could lead to a ‘Frexit’.

New Zealand Dollar (NZD) Exchange Rate Forecast to Fluctuate on Card Spending

The New Zealand economy started the week with positive ecostats with Monday bringing with it an increase in the performance of services index (PSI) – the figure rose from 58.4 to 59.5 in January.

It’s a quiet week for NZ domestic data but the Kiwi dollar may feel the impact of New Zealand credit card spending numbers on Wednesday.

Disclaimer: This economic update is provided by FC Exchange a Global Reach Group Company, industry leaders in foreign exchange. Authorised affiliates are permitted to reuse content.

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