The Week Ahead: 20th – 24th May 2024

Overview for the Week Ahead

Highlights of the Week

US Services PMIs, the FOMC Meeting Minutes, and Fed commentary will influence investor bets on a September Fed rate cut.
UK inflation and retail sales figures could affect investor expectations of a June Bank of England interest rate cut.
Economic indicators from Japan will impact buyer demand for the Yen and influence the Bank of Japan rate path.

The US Dollar This Week

On Wednesday (May 22), US housing sector data will put the investor focus on the US economy. Improving housing market conditions could fuel housing sector inflation, a focal point for the Fed. Improved conditions in the housing sector could boost consumer confidence and stimulate spending.

US jobless claims and preliminary private sector PMI numbers will warrant investor attention on Thursday (May 23). The Services PMI may impact the US dollar more. A contraction across the US services sector could raise investor expectations of a Fed rate cut.

On Friday (May 24), core durable goods orders and the Michigan Consumer Sentiment and Inflation Expectations Indexes need consideration. Upward trends in consumer confidence and inflation expectations could temper investor bets on a September Fed rate cut.

While the numbers will impact buyer demand for the US dollar, FOMC member chatter and the minutes could influence more. Fed Chair Powell is on the calendar to speak on Sunday (May 19), setting the tone for the week.

Eurozone Expectations

Trade data for the Eurozone will also need consideration on Tuesday (May 21). Economists expect the Eurozone economy to improve in H2 2024. Upbeat trade data could support a more optimistic outlook.

Preliminary private sector PMI numbers for May will warrant investor attention on Thursday (May 23). Investors should consider the sub-components, including prices, new orders, and employment. Softer input price trends and slower-than-expected service sector activity could raise investor bets in post-June ECB rate cuts.

On Friday (May 24), the German economy will be in focus, with Q1 2024 GDP numbers likely to impact buyer demand for the EUR.

ECB President Christine Lagarde is on the calendar to speak on Wednesday (May 22). Views on inflation, the economic outlook, and the post-June interest rate may create some movement with the EUR.

The Pound & The BoE This Week

On Wednesday (May 22), UK inflation figures for April will impact buyer demand for the Pound. Softer-than-expected inflation numbers could raise investor bets on a June Bank of England rate cut.

Preliminary private sector PMI figures for May also need consideration on Thursday (May 23). The Services PMI will draw more interest, accounting for over 70% of the UK economy. Upbeat numbers could test investor bets on a June BoE rate cut. Investors must also consider the sub-components, including prices, new orders, and employment.

On Friday, UK retail sales will be in focus. A pullback in retail sales could signal a softer demand-driven inflation outlook.

The NZD in Focus

On Wednesday, the RBNZ and the NZD/USD will be in focus. The RBNZ interest rate decision, rate statement, monetary policy statement, and press conference will move the dial. Barring a surprise RBNZ policy move, the press conference will likely impact the NZD/USD more.

Have your trading charts ready this week!

This Week’s High Impact Events

The times below are GMT +3.

Monday 20^th May

No High Impact Events

Tuesday 21st May

15.30 – Canada – CPI m/m

Potential instruments to Trade: CAD Crosses. 

20.00 – UK – BoE Gov Bailey Speaks

Potential instruments to Trade: GBP Crosses. 

Wednesday 22^nd May

05.00 – New Zealand – Official Cash Rate, RBNZ Monetary Policy Statement, RBNZ Rate Statement

Potential instruments to Trade: NZD Crosses. 

06.00 – New Zealand – RBNZ Press Conference

Potential instruments to Trade: NZD Crosses. 

09.00 – UK – CPI y/y

Potential instruments to Trade: GBP Crosses. 

21.00 – US – FOMC Gov Orr Speaks

Potential instruments to Trade: USD Crosses. 

Thursday 23^rd May

From 10.15 – Europe – Flash Manufacturing PMI, Flash Services PMI

Potential instruments to Trade: EUR Crosses. 

11.30 – UK – Flash Manufacturing PMI, Flash Services PMI

Potential instruments to Trade: GBP Crosses. 

15.30 – US – Unemployment Claims

Potential instruments to Trade: USD Crosses. 

16.45 – US – Flash Manufacturing PMI, Flash Services PMI

Potential instruments to Trade: USD Crosses. 

Friday 24^th May

09.00 – UK – Retail Sales m/m

Potential instruments to Trade: GBP Crosses. 

17.00 – US – Revised UoM Consumer Sentiment

Potential instruments to Trade: USD Crosses. 

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