Currency analyst

Brew a cup of coffee and plunge into reading news

EUR: EU leaders will meet today to discuss the ripple effects of the Brexit and the measures required to safeguard the rest of the Union. However, the EU members will unlikely come up with proposals for the euro area. We consider this event as neutral for the EUR.

USD: Today we will be waiting with bated breath some releases from the United States. To be precise –  for the data on the change in the price of goods and services purchased by consumers (CPI – Consumer Price Index, one of the inflation indicators). It is one of the last major releases before the Fed meeting next week. A certain scope for an increase in annual rates is expected in this data. A significant increase in prices within the services sector may cause more pressure for higher interest rates.

Another release concerns consumer attitudes and expectations about the US economy. It is measured by the UoM Consumer Sentiment Index. The indicator is closely watched by main stakeholders as consumer eagerness to spend is considered to be a key driver for the economic growth of the economy. An increase in consumer confidence may cause the US dollar appreciation.

Stick it in your notes

USD/CNH. Deustche Bank in Australia note that economic data from China released earlier this week has shown some improvement and the economic growth of the Celestial Empire is stabilizing after the five-year substantial slowdown.  Chinese banks will be closed today on the occasion of the Mid-Autumn Festival. It'll be back to normal on Monday. So it’s probably better to switch to those Asian banks that are open: New Zealand, Australia, Singapore, Japan.

Keep an eye on the BOJ

There is plenty of focus on the Bank of Japan before its policy meeting next week.  Many economists forecast an expansion of monetary stimulus from the BOJ. However, according the Wall Street Journal report, the members of the BOJ board split over the easing program. 

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