Weekly Outlook, Nov 16-20: Top Five Economic Events to Watch Next Week!
Arslan Butt • 4 min read
The broad-based US dollar is likely to end this week on a bearish track, as investors are still cheering the optimism over a potential vaccine for the highly infectious coronavirus, which is keeping the safe-haven US Dollar under pressure, while tempering the risk assets rally. Apart from this, the substantial losses in US bond yields and the Federal Reserve’s policy of an extended period of low-interest rates and hopes for a global economic recovery from COVID-19 have also played a major role in undermining the greenback.
Looking ahead into the coming week, the series of Employment Change and the Unemployment Rate meeting, along with minutes of the RBA Monetary Policy Meeting and the G20 Meetings, could drive plenty of headlines to keep the markets on the move. The geopolitical tensions and coronavirus headlines will also be closely followed, as they could play a key role in determining risk levels in the market.
Top Five Economic Events to Watch This Week
1. CAD Manufacturing Sales (MoM) – Monday – 6:30 AM GMT
The Manufacturing Sales data is typically released by Statistics Canada, which measures overall Sales in Canada. It can be seen as the expected market demand. Put simply, the increasing number of goods, including unsold inventories, points to a fall in the market demand, which is seen as negative or (bearish) for the CAD currency. Besides this, decreasing sales numbers also anticipate a bearish tone for the CAD. Likewise, growing sales numbers are seen as positive (or bullish) for the CAD.
In other words, data is a leading indicator of economic health. However, the manufacturers are very quickly affected by market conditions. Simultaneously, changes in their sales can be an early sign of future activity, such as spending, hiring and investment.
ACTUAL: -2 %
DATE: 11/16/2020 12:30
2. US Retail Sales (MoM) – Tuesday 6:30 AM GMT
This data is usually released by the US Census Bureau, which measures the total receipts of retail stores. Monthly percentage changes show the rate of change in such sales. However, the changes in Retail Sales are broadly followed as a leading indicator of consumer spending. Thus, if the ‘Actual’ is greater than the ‘Forecast’, it is seen as bullish for the greenback. Conversely, a low figure is seen as negative (or bearish) for the US Dollar.
ACTUAL: 1.9 %
DATE: 11/17/2020 12:30
Description Of Retail Sales excl. Autos (MoM)
This data is typically released by the US Census Bureau. It usually shows all goods sold by retailers, based on a sampling of retail stores of different types and sizes, excluding the automobile sector. It should be noted that the retail sales index is considered the leading indicator of consumer confidence. However, thise report is the ‘advance’ report, which can change somewhat after the final numbers are calculated. Thus, figures greater than the forecast indicate progress in economic growth, which is considered bullish for the US Dollar.
ACTUAL: 1.5 %
DATE: 11/16/2020 12:30
3. BoE Haldane’s speech – Monetary Policy Report Hearings – Wednesday – 2:00 PM GMT
Andrew G Haldane is the Chief Economist at the Bank of England and Executive Director of Statistics and Monetary Analysis. Apart from this, Andrew G Haldane is also a member of the Bank’s Monetary Policy Committee. He will deliver a speech this Wednesday, to report on inflation and the economic outlook before Parliament’s Treasury Committee. However, the discussions, which will only last a few hours, can create considerable market volatility. Thus, if the discussions are more hawkish than expected, it is seen as positive or (bullish) for the GBP currency. Likewise, if they are the more dovish than anticipated, it is seen as bearish for the currency.
Furthermore, the members of BOE MPC vote on where to set the country’s key interest rates, while their public engagements are typically used to provide detailed clues regarding future monetary policy.
4. Aussie Employment Change Data – Thursday – 12:30 AM GMT
This data is typically released by the Australian Bureau of Statistics, which examines the change in the number of employed people in Australia. This economic data is released at the end of the month. If the data shows an increase, it has positive implications for consumer spending, which boosts economic growth. Thus, if the ‘Actual’ is greater than the ‘Forecast’, it is seen as bullish for the AUD currency; conversely, lower figures are seen as negative (or bearish) for the AUD currency.
ACTUAL: -29.5 K
DATE: 11/19/2020 00:30
Aussie Unemployment Rate Data:
This data is typically released by the Australian Bureau of Statistics, which measures the number of unemployed workers, divided by the total civilian labor force. However, the number of unemployed people is a leading signal of overall economic health, as consumer spending is exceptionally correlated with labor-market conditions. Hence, a rise in the rate indicates a lack of expansion within the Australian labor market. As a result, if the ‘Actual’ is less than the ‘Forecast’, it is seen as positive (or bullish) for the Aussie currency. Conversely, high readings are seen as negative (or bearish) for the Australian Dollar.
ACTUAL : 6.9 %
DATE: 11/19/2020 00:30
5. G20 Meeting – Friday
At the G20 meeting, central bank governors and finance ministers from systematically important industrialized and emerging economies gather, in an effort to discuss leading issues affecting the global economy. Traders should keep a close eye on this event, which brings a new dimension to the markets. The G20 nations are likely to discuss COVID-19 driven impacts on economic groups and the potential ways to fight and overcome economic slowdowns. Let’s keep an eye on these events to learn more about forex market trends. Good luck, and have a splendid weekend!