Weekly Forex Outlook for September 12-16

Following the sharp appreciation of the USD against major currencies such as Euro and CAD, there are many questions regarding the direction of major forex including Euro/USD in the upcoming week. There are many news items and reports that will be published this week that could affect traders including: US Federal Budget Balance, U.S. PPI and Philly Fed Manufacturing Index. Here is a forex outlook for the week of September 12th to September 16th.   

(all times GMT):

  1. Monday September 12th, 2:30 – Australian trade of Balance: The upcoming report will regard July 2011. In the June 2011 report, the seasonally adjusted balance of goods and services declined from a surplus of $2,699 million May 2011 to $2,052 million in June 2011 – a $647 million decrease;
  2. Tuesday September 13th, 7.00 –US Federal Budget Balance: this upcoming publication will show the changes in the US federal balance for August 2011; this report indicates the government debt growth and thus may affect the USD. In the previous report, the US government deficit reached in July $129.37 billion –  nearly $86 billion increase from the $43.080 billion deficit recorded in June 2011, but a decrease of 21% from the July 2010 (See here a summary of the recent report);
  3. Wednesday September 14th, 13.30 – U.S. PPI: This report will present the progress in the PPI during August. In the previous July report , the index for finished goods inclined by 0.2%; this index inclined mainly due to the rise in food prices; this news could have an effect USD;
  4. Wednesday September 14th, of 15:30 – Changes in US retail sales: this report shows the monthly changes in the retail sales and food services; in last month’s report regarding July, the retail sales, when controlling for the price changes, slightly inclined by 0.5% from the previous month;
  5. Thursday September 15th, 9.00 – ECB monthly bulletin: This monthly bulletin analyzes the economic situation of the Euro Area including price stability, internet rate decisions and governments debt; this report might provide some insight into the recent sharp depreciation of the Euro against the USD (see here last report)  ;
  6. Thursday September 15th, 10:00 – Euro zone CPI: In the last report regarding July 2011, the annual inflation rate declined to 2.5%,a 0.2 percent points decline compared with June’s inflation; this inflation rate is still above the target inflation of ECB of 2%. The expectations in the upcoming CPI report for August 2011 are a slight drop;
  7. Thursday September 15th, 13:30 – U.S. unemployment claims: For the week ending on September 3rd, initial claims rose by 2,000 to 414,000 claims; the insured unemployment rate remained unchanged at 3.0% for the week ending on August 27th; the number of insured unemployment was 3.717 million, a decrease of 30,000 compared with the previous week’s (see here my recent review on the US Labor market);
  8. Thursday September 15th, 13:30 –US CPI: This monthly report will show the main changes in the consumer price index during August. According to the US Bureau of Labor statistics for July 2011, the CPI inclined by 0.5% and over the last 12 months by 3.6%. The core CPI inclined in July by 0.2%. The main reasons for this increase are related to the sharp increase in energy prices;
  9. Thursday 15th of September 15.00 – Philly Fed Manufacturing Index: This monthly survey provides an indicator for the economic progress of the US economy as it measures the manufacturing conditions of the US. In the recent August survey, the index declined from a positive reading of 3.2 in July to -30.7 in August – the lowest level since March 2009. This index, may have been among the factors to affect USD (see here last report)  ;
  10. Thursday September 15th, 19:00 –Trichet gives a speech:  following the recent rate decision as ECB kept rates unchanged, ECB president, Trichet will give a speech regarding the economic stability of the Euro Area, the recent depreciation of the Euro against the USD and the debt crisis;
  11. Friday September 16th, 14:00 – US TIC long term purchases: The Treasury International Capital report will present the main changes in the purchases and sales of US long term treasuries during July 2011. In the previous report regarding June 2011, the net foreign holdings in US Treasuries longer-term notes fell by $11.5 billion (see here my last review of June 2011).

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Lior Cohen, M.A. Forex analyst and blogger at Forex NRG.

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