23 December, AtoZForex.com, Lagos – Yesterday, the focus was set on the stable US GDP release, the US official report showed real gross domestic product (GDP) increased at an annual rate of 2.0 percent in the third quarter of 2015, according to the “third” estimate released by the Bureau of Economic Analysis. Compared to the second quarter, real US GDP was revised down to 2.1 percent. The growth was buoyed by consumer spending as businesses struggled to sell to overseas customers battered by sluggish growth.
The dollar continues to show weakness against most of its major counterparts, following the stable US GDP figure. For today, the fundamentals are taking centre stage again, as it marks a busy day with high impact data from the US, UK and Canada, compared to the rest of the week.
UK Current Account (9:30 A.M GMT)
This metric measures the difference in value between imported and exported goods, services, income flows, and unilateral transfers during the previous quarter. It is forecast to come at a deficit of 21.3 billion. With the Sterling’s current weakness, another unimpressive report could spur further downside sentiment on the currency, also considering the steep decline in oil prices and risk of deflation in the London housing market. The sterling remains vulnerable as there remains a risk of a sharp deterioration in sentiment and sustained downward pressure on the currency.
Canada GDP and retail sales (1:30 P.M GMT)
The Canadian dollar is one of the hardest hit majors against the USD this year, thanks to the pressure on the economy as energy prices slid. Aside yesterday’s stable US GDP, today we have the GDP data of Canada. Last month, a change in the inflation-adjusted value of all goods and services produced by the economy of -0.5% was recorded, that is the activities shrank by 0.5%, the worst month in 2015. Last month’s core retail sales which measures the change in the total value of sales at the retail level, excluding automobiles, also came at -0.5%. The USDCAD pair remains in a bullish trend, even though momentum has slowed at the moment.
US Core Durable Goods Orders m/m
This metric measures the change in the total value of new purchase orders placed with manufacturers for durable goods, excluding transportation items. It is forecast to come at 0.1%. With the diverging policies of the European and US central banks, the possibility of the Euro dollar parity is fading as the dollar sentiment may now be turning bearish in the near term after the dovish Fed rate hike.
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