Economic Events Outlook, Feb 21 – ECB Minutes and US Durable Orders on the Radar

Posted Thursday, February 21, 2019 by
Arslan Butt • 2 min read

Good morning, traders.

A day before, the Greenback traded bullish as the FOMC meeting minutes signaled a rate hike this year, triggering the demand for US dollar. The dollar index added around 0.1% percent to touch 96.569, after FOMC pushed the dollar away from two weeks low of 96.286.

Speaking of the fundamental events, the economic docket is fully loaded with some top-tier economic events like monetary policy accounts from the ECB’s latest meeting and US Core Durable Goods Orders. Are you up for it?

Economic Events Watchlist

Euro – EUR
The day begins with low to medium impact economic events from the Eurozone. These are services and manufacturing PMI figures which drove massive volatility in the Euro during the previous month. Therefore, investors won’t be taking them for granted today.

French Flash Manufacturing PMI – The figure is due at 8:15 (GMT) with a forecast of 51 vs. 51.2 during the previous month.

French Flash Services PMI – Besides the French Manufacturing PMI, the services PMI will also be observed. It’s expected to rise from 47.8 to 48.6 this month. Let me remind you, this figure caused massive trouble to Euro last month as the figure fell from 50.6 to 47.6.

German Flash Manufacturing PMI – The data will be released at 8:30 (GMT) by Markit. It’s forecast to be neutral and expected to remain steady at 49.7.

German Flash Services PMI – While German services PMI is expected to drop from 53 to 52.8. It’s coming out with German manufacturing PMI, so we need to monitor both figures to capture a quick move.

Almost all of the services and manufacturing PMI figures are negatively forecast, and the single currency Euro may face selling pressure on Thursday. Worse than expected economic data will form a dovish monetary policy sentiment and can lead a bearish trend in Euro.

ECB Monetary Policy Meeting Accounts

As you know, the past few months have been hard for the Eurozone. The macroeconomic figures have disappointed the market again and again, with more weakness seen in major economies like Germany, Italy, and Spain.

It’s not only the manufacturing figures which remain weak, but the inflation rate also remained subdued. I think it’s a clear sign that ECB will be hesitant to come up with a hawkish tone in today’s monetary policy accounts. Even if Mario Draghi tries to support Euro with positive remarks, don’t get in the trap as the longer-term trend seems bearish for Euro.

Remarks on tapering the QE (Quantitative program) and the next rate hike (which is expected by the end of 2019) will help us drive further trends in Euro.

US Dollar – USD

Core Durable Goods Orders m/m
Besides the European economic events, we should monitor the core durable goods orders from the US at 13:30 (GMT). It’s an economic indicator that measures the change in the total value of new purchase orders placed with manufacturers for durable goods, excluding transportation items.

Considering the economists’ forecast, orders are expected to gain by 0.3% which is higher than the -0.4% drop in January 2019.

Canadian Dollar – CAD

BOC Governor Poloz is due to speak about monetary policy at the Chamber of Commerce of Metropolitan Montreal. The text of the speech is due at the release at 17:35 (GMT) while the speech is scheduled to be delivered 15 minutes later.

That’s all about fundamentals, but keep following FX Leaders for forex trading signals and exciting trade ideas. Good luck!

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imraan Ali Rajpoot
imraan Ali Rajpoot
4 years ago

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