Weekly Outlook, Dec 7, 2020 – Dec 11, 2020: Top Economic Events to Watch This Week
Arslan Butt • 3 min read
The broad-based US dollar has ended this week on the bearish track, as Thursday’s release of downbeat US economic data exerted a lot of downside pressure on the greenback. In the meantime, the optimism over the coronavirus vaccines and the US stimulus package are urging investors to invest in riskier assets, rather that safe-havens. Apart from this, the losses in the greenback could also be associated with doubts over the economic recovery from COVID-19 in the United States. It is worth mentioning that hospitalizations in the US have crossed the 100,000 mark, and the governor of California, Gavin Newson, has warned that stay-at-home orders could be imposed in every region of the state, excluding the San Francisco Bay Area. This has also kept the American currency under pressure.
Looking ahead into the coming week, the series of Manufacturing PMI and Unemployment Claims, along with the BOC Rate Statement and the European Monetary Policy Statement, 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
JPY Gross Domestic Product (QoQ): – Monday – 23:50 GMT
Gross Domestic Product (QoQ):
This data is normally released by the Cabinet Office, which shows the monetary value of all the goods, services and structures produced in Japan within a given period. Furthermore, this data is a gross measure of market activity, because it indicates how the Japanese economy is improving or weakening. Thereby, high figures or better-than-expected figures, are seen as bullish for the Japanese currency. Conversely, a low reading is seen as negative or bearish for the JPY.
CONS: 4.4 %
DATE: 11/15/2020 23:50
EUR Gross Domestic Product s.a. (QoQ): – Tuesday -10:00 GMT
Eurostat typically releases this data, which examines the total value of all goods and services produced in the Eurozone. It is worth noting that the GDP is seen as a broad measure of the economic activity and health of the Eurozone. In that way, the rising trend has a positive or bullish impact on the EUR. Conversely, if it is falling, it is considered as negative for the Euro.
DATE: 11/13/2020 10:00
BoC Rate Statement: – Wednesday – 15:00 GMT
This statement is the primary medium used by the Bank of Canada (BoC) to communicate with investors about monetary policy decisions, specifically those regarding interest rates.
The Bank of Canada typically announces this decision, and if the Bank of Canada is hawkish concerning the Canadian economy’s inflationary outlook, and raises the interest rates, it is seen as bullish for the Canadian dollar. Conversely, if the BoC has a dovish outlook on the Canadian economy and keeps the ongoing interest rate or cuts the interest rate, it is considered bearish for the CAD.
DATE: 10/28/2020 14:00
ECB Interest Rate Decision:- Thursday – 12:45 GM
The European Central Bank typically announces this decision, and if the ECB is hawkish concerning the European economy’s inflationary outlook and increases the interest rates, it is seen as bullish for the Euro. Conversely, if the ECB has a dovish outlook on the European economy and keeps the ongoing interest rate or cuts the interest rate, it is considered bearish for the shared currency.
DATE: 10/29/2020 12:45
ECB Monetary Policy Statement and Press Conference – Thursday – 13:30 GMT:
After the ECB’s economic policy decision, the ECB President gives a press conference about the monetary policy. His comments usually affect the volatility of the EUR and determine a short-term bullish or bearish trend. A hawkish view is seen as positive for the Euro; conversely, a dovish outlook is seen as negative or bearish for the EUR.
Producer Price Index ex Food & Energy (YoY):– Friday – 13:30 GMT:
This data is normally released by the Bureau of Labor Statistics, which examines the average changes in prices in America’s primary markets, by producers of commodities, in all states of processing. Volatile products, like food and energy, are excluded, in the interests of capturing an accurate calculation. High figures are considered as bullish for the USD; conversely, low figures are seen as negative or bearish for the greenback.
DATE: 11/13/2020 13:30
Michigan Consumer Sentiment Index: – Friday – 15:00 GMT
The University of Michigan normally releases this data, which is a survey of personal consumer confidence in terms of economic activity. This data gives a picture of whether or not consumers are willing to spend money. A high figure is seen as positive (or bullish) for the greenback; conversely, low figures are seen as negative (or bearish) for the US dollar.
DATE: 11/25/2020 15:00