The US dollar has remained steady ahead of Yellen’s speech today. The UK and US GDP reports due today, along with reports from the Jackson hole conference serve as the major market drivers on the daily Forex news and trade opportunities.
26 August, AtoZForex – Jackson hole takes center stage amid question will the Fed increase its interest rate this year.
#1 US Core Durable Goods Orders beat expectations!
Released yesterday, the latest month on month data showed a better than expected US Core Durable Good orders. July Core durable goods orders came at 1.5% against the consensus of 0.4% and provisions reading of -0.4%. The dollar did not do much in response as markets await Yellen’s speech today.
#2 All eyes on Gold
Current global economic conditions have provided a platform of support for gold with a subdued yield and growth environment attracting inflow as investors scratch around looking for returns, an environment which is likely to remain for the time being. The next key signpost will be comments from Fed Chair Yellen tomorrow at the Jackson Hole conference. Expectations ahead of the event are mixed with some expecting that the Fed chair will nod to the likelihood of a rate rise later this year, buoyed by diminished economic risks and positive momentum in labour market conditions.
Opportunity: Buy gold on dovish or neutral tone
#3 German Ifo Business Climate Index hit by Brexit
The Ifo Business Climate Index, which mirrors the economic developments in Germany, has been published. This month, the Ifo figures came disappointing, as the index dropped from 108.3 in July to 106.2 In August. Interestingly, some of the experts were anticipating the slight increase in the Ifo Business Climate Index. However, the data came in a different shape, making the institute’s president Clemens Fuest say that “the German economy has fallen into a summer slump.”
#4 Expectations ahead of BoJ meeting
Bank of Japan (BoJ) meeting is approaching, as it is scheduled next month, and the Bank is expected to take a monetary policy move. This event is highly important and is discussed by economic analysts all over the globe. Some of the Reuters poll’s data suggests that a lot of economists believe in more BoJ easing coming in the Bank’s meeting in September. The other important findings include the fact that over half of the recipients said that BoJ will turn to a more flexible wording on the inflation targets.
#5 Fed Yellen’s speech at Jackson Hole
With little guidance from the FOMC, investors turn their heads to Fed Janet Yellen’s speech in Jackson Hole, Wyoming on Friday to hopefully understand Fed’s rhetoric and see the bigger picture. However, given Ms Yellen’s recent stance of “wait and see,” some market participants expect the Fed chair to remain neutral ahead of US presidential election on 8th of November and this weekend’s symposium to be a relative non-event.
Opportunity: Buy EURUSD on dovish or neutral tone
#6 UK Second Estimate GDP q/q
The UK Second Estimate GDP q/q is expected to show a 0.6% change in the inflation-adjusted value of all goods and services produced by the economy. Based on recent data, the Brexit effect does not seem to have taken its toll on the economy so far. This report will be watched closely for confirmation of this.
Opportunity: Buy GBPUSD on upbeat data
#7 US Prelim GDP q/q due
Concluding the daily Forex news and trade opportunities, the US Prelim GDP q/q is forecast to come at 1.1%. A tad below the previous reading of 1.2%. This will be the first driver of the dollar ahead of the highly anticipated Yellen speech. All eyes on the dollar.
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