Strategy Reports

September 6

With the U.S. on holiday on Monday, the Australian TD Securities inflation report is the only economic data of the day.
 
AUD - 0:30 GMT: Australian August TD Securities Inflation (M/M) (Prior: +0.1%)
Australian August TD Securities Inflation (Y/Y) (Prior: +2.8%)
Inflation control is high on the list of proprieties for the Reserve Bank of Australia and faster CPI data will give traders the reason they need to bet on more aggressive moves from the RBA, ie, buy AUD.
 
September 7

The Bank of Japan and Reserve Bank of Australia’s interest rate decision, followed by the Swiss employment report, German factory orders and the New Zealand manufacturing outlook are the main event son Tuesday.
 
JPY: BOJ Rate Decision (Exp: 0.1% Prior: 0.1%)
Again, no one is expecting the Bank of Japan to modify its interest rate, but the strong yen could cause the BOJ to undertake some additional measures to weaken the currency. At the very least, expect the central bank to warn of the negative effects of a strong currency on the export economy.
 
AUD - 4:30 GMT: RBA Cash Target (Exp: 4.50% Prior: 4.50%)
A hold is pretty well priced into the markets at this stage and shouldn’t generate a huge reaction in the AUD, unless the central bank hints at more hikes to come.

CHF - 5:45 GMT: Swiss August Unemployment Rate (Exp: 3.6% Prior: 3.6%)
Swiss August Unemployment Rate (sa) (Exp: 3.7% Prior: 3.8%)
Another textbook example, an upbeat report in here will lead to more buying in the franc, while a downbeat report should hurt the currency. Nevertheless with the Swiss National Bank firmly in control of FX, gains in CHF will be limited.

EUR: 10:00 GMT – German July Factory Orders (M/M) (Exp: +0.5% Prior: +3.2%)
German July Factory Orders (Y/Y) (Exp: +20.6% Prior: +24.6%)
One of the benchmark manufacturing reports for the euro zone, German factory orders have the potential to move the markets. An upbeat report should help the euro.

NZD – 22:45 GMT: New Zealand Q2 Manufacturing Activity (Prior: 0.9%)
As usual, some stronger than expected results should help the Kiwi dollar, while downbeat results could hurt it.

JPY - 23:50 AM GMT: Japanese July Current Account Balance Total (Exp: +¥1534.6B Prior: +¥1047.1B)
Japanese July Adj Current Account Bal. (Exp: +¥1362.9B Prior: +¥1362.1B)
With trade comprising one of the cornerstones of the Japanese economy, a larger than expected current account surplus serves as a good reason to buy the Japanese currency.
 
September 8

The action heats up on Wednesday with the German trade balance, UK industrial and manufacturing production, the UK visible trade balance, the Bank of Canada’s interest rate decision, The Canadian Ivey PMI, The Fed’s Beige Book Economic Report, and the Japanese BSI report.
 
EUR – 6:00 GMT: German July Trade Balance (Exp: +13.0B Prior: +14.1B)
German July Current Account Balance (Exp: +11.5B Prior: +12.9B)
German July Imports (M/M) (Exp: +0.1% Prior: +1.6%)
German July Exports (M/M) (Exp: 0.0% Prior: +3.7%)
A weaker euro is likely to give some momentum to the German exports sector. Confirmation of this may give the euro bulls reason to bid the currency higher against majors.

GBP – 8:30 GMT: UK July Industrial Production (M/M) (Exp: +0.4% Prior: -0.5%)
UK July Industrial Production (Y/Y) (Exp: +2.0% Prior: +1.3%)
UK July Manufacturing Production (M/M) (Exp: +0.3% Prior: +0.3%)
UK July Manufacturing Production (Y/Y) (Exp: +4.9% Prior: +4.1%)
Probably the benchmark report for the UK’s manufacturing sector, upside surprises will offer a ray of light to the UK’s murky economy.

CAD – 13:00 GMT: Bank of Canada Rate Decision (Exp: 1.00% Prior: 0.75%)
There is a lot of debate as to whether the Bank of Canada will hike rates just one more time to reach 1.00% at this meeting, and given the uncertainty, the forex opportunities are rampant. An unexpected hold should weaken the Canadian dollar, while a hike should strengthen it.

CAD – 14:00 GMT: Canadian August Ivey PMI (Exp: 55.0 Prior: +54.0)
As one of the earlier readings of the health of the Canadian economy, this indicator can have some market-moving impact. A better than expected result should help the Canadian dollar.

USD: 18:00 GMT – Fed’s Beige Book Economic Report
One of the benchmark reports from the Federal Reserve, the Beige Book is a reflection of how the central bank feels about the U.S. economy. An upbeat report should be dollar-positive.

JPY – 23:50 GMT: Japanese Q3 BSI Large All Industry Index (Q/Q) (Prior: +4)
Japanese Q3 BSI Large All Industry Index (Y/Y) (Prior: +10)
As usual for the yen, upbeat economic performance should weaken the Japanese currency through declines in risk aversion. The reverse is also true.
 
September 9

On Thursday, market participants will pay attention to the Australian employment report, the Bank of England’s interest rate decision, Canadian housing starts, the U.S. and Canadian trade balances, U.S. weekly jobless claims, and the final Japanese Q2 GDP report.
 
AUD - 1:30 GMT: Australian August Employment Change (Exp: +25.0K Prior: +23.5K)
Australian August Unemployment Rate (Exp: 5.2% Prior: 5.1%)
The Australian economy is doing well and the employment sector has managed to prove itself a couple times. A better than expected number will increase the odds of another rate hike from the RBA, meaning AUD will rally. The reverse is also true.

GBP- 8:30 GMT: UK July Visible Trade Balance (Exp: -£7500M Prior: -£7401M)
Likely to be overlooked by the currency markets, a deterioration in the balance may cause some selling of sterling, but any moves will be short lived.

GBP: 11:00 GMT: BOE ANNOUNCES RATES (Exp: 0.50% Prior: 0.50%)
BOE Asset Purchase Target March (Exp: +£200B Prior: +£200B)
This decision should be pretty straight forward with no change in rates or asset purchases expected. We already know that the BOE is beginning to worry about inflation, but no change in interest rates is expected. That being said, if the central bank decides to end its asset purchase program, it could cause to gains in the pound sterling.

CAD – 12:15 GMT: Canadian August Housing Starts (Exp: 185.0K Prior: 189.1K)
As a benchmark measure of the health of the Canadian housing market, a better than expected result should help support the Canadian dollar. The reverse is also true.

USD: 12:30 GMT: W/E September 4 U.S. Initial Jobless Claims (Exp: +470K Prior: +472K)
The markets continue to expect lower jobless claims and failure to do so will most certainly cause a decline in the U.S. dollar, the magnitude of which will depend on the mood going into the announcement.

USD - 12:30 GMT: U.S. July Trade Balance (Exp: -$47.0B Prior: -$49.9B)
Traders can use the U.S. trade statistics to fine-tune their positions but otherwise trade data is more affected by currency moves than vice versa. Nevertheless a widening of the deficit is USD negative.

CAD - 12:30 GMT: Canadian July International Merchandise Trade (Exp: -C$0.8B Prior: -C$1.1B)
The strong Canadian dollar is allegedly going to wipe out a lot of the upbeat developments for the Canadian economy and should the country’s trade balance fall into deficit, it may scare traders into believing the loonie is overvalued.

JPY – 23:50 GMT: Japanese Q2 Final GDP (Q/Q) (Exp: +0.4% Prior: +0.1%)
Japanese Q2 Final GDP Annualized (Exp: +1.5% Prior: +0.4%)
Japanese Q2 Final Nominal GDP (Q/Q) (Exp: -0.7% Prior: -0.9%)
As the final look at Q2 GDP, this report will likely be ignored unless there are some serious revisions in either direction. A better than expected result will likely weaken the currency as risk aversion declines, and vice versa.
 
September 10

The week ends on the Chinese trade balance, UK PPI and Canadian employment reports.
 
ALL: Chinese August Trade Balance (Exp: +$26.8B Prior: +$28.73B)
Market participants have been looking to the Chinese export sector as a proxy for global economic growth, so an unexpectedly large contraction in exports can spark global risk aversion, with the greenback rallying and majors selling off.

GBP - 8:30 GMT: UK August PPI Input NSA (M/M) (Exp: +0.1% Prior: -1.0%)
UK August PPI Input NSA (Y/Y) (Exp: +8.9% Prior: +10.8%)
Since inflation is the main point of the BOE’s mandate, this report will provide clues on the following week’s CPI release. That being said, inflation is somewhat on the backburner as a priority, but as long as price growth remains slow, one can be sure the central bank will keep rates, and consequently the pound, relatively low.

CAD - 11:00 GMT: Canadian August Unemployment Rate (Exp: 8.0% Prior: 8.0%)
Canadian August Net Change in Employment (Exp: +30.0K Prior: -9.3K)
The most important data point for the week for the loonie, recent Canadian data have been rather poor, even though the country’s overall economy going forward appears to be upbeat. Again, with nonfarm payrolls out just an hour-and-a-half later, traders will likely wait before reacting to this report. Otherwise this should be a textbook case for currencies. Buy Canadian on better than expected data.