Weekly Forex Outlook for October 3-7

Here is an outlook of the main news items and reports that could affect the forex markets for the week of October 3rd to October 7th related to U.S., Euro Area, Australia, Japan and Canada.   

(all times GMT):

  1. Monday 3rd of October 15.00 – U.S. ISM Manufacturing PMI: This report will show the monthly change in manufacturing sector on a national level during September 2011. During August the index slipped to 50.6% a 0.3 percent points decrease compared to July’s index; this index might affect traders of crude oil and natural gas (see here my review of last report);
  2. Monday 3rd of October 2:30 – Australian Trade Balance: The upcoming report will regard August 2011. In the July 2011 report, the seasonally adjusted balance of goods and services inclined from a surplus of $1,817 million in June 2011 to $1,826 million in July 2011 – a $9 million increase. There was an increase in export of non-monetary gold by $596 million (82%) (see here last report);
  3. Tuesday 4th of October 5:30 – Reserve Bank of Australia – Cash Rate Decision: the overnight money market interest rate of Australia’s Reserve Bank was left unchanged at 4.75% since November 2010. Australia’s inflation rate continues to be near the Bank’s target inflation, and the unemployment rate near 5%; on the other hand the AUD/USD sharply fell during September, and this trend might affect the RBA’s decision on the rate decision (see here previous report);
  4. Tuesday 4th of October 14:00 – ECB conference Trichet speaks:  before the ECB announcement of its rate decision on Thursday, Trichet might provide some insight into what will be ECB’s decision. He will probably also refer to the recent decisions of European policymakers to increase the EFSF funds;
  5. Tuesday 4th of October 15:00 – Bernanke Testifies: following the announcement of FOMC plan to purchase LT securities and to sell ST securities to conclude by June 2012, the Chairman of the Federal Reserve is likely to address the stability and progress of US economy;
  6. Wednesday 5th of October 15.00 – U.S. ISM Non-Manufacturing PMI: This report will show the changes of non-manufacturing sector in September. During August this index reached 53.3% – slightly higher than in July; this index might affect forex traders and the USD (see here last report).
  7. Thursday 6th of October 13:30 – ECB Rate Decision: This rate decision will be Jean Claude Trichet‘s, President of the European Central Bank, last one as President. Last month ECB kept the interest rate unchanged at 1.5%. According to the recent Euro Area inflation rate report, the rate remained at 2.5% (annual terms) in August, but the Euro Area is still facing dire times vis-à-vis the debt crisis. To help banks with their liquidity problems, ECB and Fed offered USD based loans to banks until the end of the year. Especially since there are pressures to lower the ECB interest rate. If ECB will lower interest rates it is likely to lower the Euros to US dollar exchange rate;
  8. Thursday 6th of October tentative – Bank of Japan – Rate Decision: This statement will present Bank of Japan’s rate decision and other monetary related decisions. In the recent statement the bank kept the interest rate at 0 to 0.1 percent;
  9. Thursday 6th of October 13:30 – U.S. Unemployment Claims: For the week ending on September 23rd, initial claims declined by 37,000 to 391,000 claims; for the week ending on September 17th, the number of insured unemployment was 3.749 million, a decrease of 20,000 compared with the previous week’s (see here my recent review on the US Labor market);
  10. Friday 9th of October 12:00 – Canada Unemployment Rate: In the recent employment August report, unemployment slightly inclined by 0.1 percent points to 7.3%; the main decreases were in the construction sector with 24,000 falls, and transportation and warehousing with 14,000 decreases. If the upcoming report will show an improvement in the labor report in Canada in September, this might strengthen the Canadian dollar against the USD (see here previous report);
  11. Friday 7th of October 13.30 – U.S. Unemployment Rate: in the last September report regarding August, the number of non-farm payroll employment remained unchanged; the US unemployment rate also remained unchanged at 9.1%;; there are speculations that the upcoming October report won’t show an increase in employment. This report might affect US dollar (see my last review on the US employment report).


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