The Week Ahead – Brexit, Earnings, Stats and Monetary Policy are in Focus

A quiet start to the week will leave the focus on earnings. What little data that is due out could have a material influence, however.
Bob Mason
Currency exchange notice board

On the Macro

For the Dollar:

It’s a quieter week ahead for the Greenback.

Through the first part of the week, March existing home sales and new home sales figures are due out on Monday and Tuesday.

The numbers are unlikely to have a material influence, with sentiment towards the housing sector having seen a marked improvement of late.

Data due out in the 2nd half of the week will have a more material impact on the Dollar and risk sentiment. March durable goods orders are due out on Thursday, with 1st quarter GDP numbers due out on Friday.

While softer numbers are expected, due to the extended government shutdown, anything worse than forecasted will hit risk appetite hard.

Outside of the figures, expect earnings and geopolitical risk to also impact the Dollar in the week.

The Dollar Spot Index ended the week up 0.42% to $97.378.

For the EUR:

Economic data includes flash consumer confidence figures out of the Eurozone on Tuesday, which are released ahead of Germany business confidence numbers on Wednesday.

Of less material influence will be French jobseeker figures on Friday.

In a shortened week, European markets closed on Monday, business confidence figures will likely have the greatest impact.

The EUR/USD ended the week down 0.48% to $1.1245.

For the Pound:

It’s a quiet week ahead. Key stats are limited to CBI Industrial Trend Orders due out on Thursday.

Barring a material move from March’s figure, which was the weakest since May 2018, there’s unlikely to be too much impact on the Pound.

MP’s return to Westminster on Tuesday and Theresa May will be on a mission to wrap up an exit solution before the EU Parliamentary elections.

Indicative votes could be on the cards in the week.

The GBP/USD ended the week down 0.62% at $1.2993.

For the Loonie:

It’s a quiet week ahead on the data front, with key stats limited to wholesale sales figures due out on Tuesday.

A material jump in sales would provide support for the Loonie, though the main event will be on Wednesday. The Bank of Canada will deliver its April monetary policy decision and report ahead of the customary press conference.

With the U.S – China trade war ongoing, there’s little incentive for the BoC to change tact. They will likely remain dovish, joining a string of banks that have raised concerns over the economic outlook.

The Loonie ended the week down 0.51% to C$1.3391 against the U.S Dollar.

Out of Asia

For the Aussie Dollar:

It’s a quiet week ahead. 1st quarter inflation and wholesale inflation figures are due out on Wednesday and Friday respectively. Following the latest RBA minutes and uncertainty over the economic outlook, this week stats will have a material impact on the Aussie Dollar.

Outside of the numbers, corporate earnings will remain in focus to drive sentiment towards the global economic outlook, which will also influence commodities and the Aussie Dollar.

The Aussie Dollar ended the week down 0.29% to $0.7152.

For the Japanese Yen:

It’s a relatively busy week ahead. March retail sales and prelim industrial production numbers are due out on Friday. Earlier in the Friday session, April inflation figures will also be released, though the numbers are unlikely to have an impact on the Yen.

We can expect the markets to respond to the retail sales and production figures, both of which are key to economic growth.

On the policy front, the BoJ will deliver its April policy decision, though few surprises are anticipated.

The Japanese Yen ended the week up 0.09% to ¥111.92 against the U.S Dollar.

For the Kiwi Dollar:

Another quiet week ahead leaves March trade data due out on Friday to provide direction.

Market risk sentiment will influence ahead of the numbers.

The Kiwi Dollar ended the week down 1.17%% to $0.6684.

Out of China:

There are no material stats due out. Updates on the U.S – China trade could hit the news wires in the week, however.

Geo-Politics

U.S – China Trade War:  The markets will be hoping that the talking is done and an agreement is made. With the U.S President incentivized to deliver, there could be some good news in the week. Though it might not be great for everyone…

Brexit: Lawmakers return from the Easter break and Theresa May will be looking to resume talks. Indicative voting may be the way forward in fishing out a supported deal. Cross-party talks may have caused more harm than good…

The Rest

On the monetary policy front,

For the Loonie, The BoC will deliver its monetary policy decision on Wednesday. While few are expecting a move, the dovish tone may well persist at the press conference.

For the JPY, the BoJ will deliver its monetary policy decision on Thursday. While it’s not been bells and whistles for the Japanese economy, it may be too soon for the BoJ to make a move… There is the threat of U.S tariffs after all.

U.S Corporate Earnings: Corporate earnings will pack a punch in the week ahead. Some of the key releases include those for:

Tuesday, 23rd April

  • The Coca-Cola Co.
  • Lockheed Martin Corp.
  • The Procter & Gamble Co.
  • Twitter Inc.
  • Verizon Communications Inc.

Wednesday, 24th April

  • AT&T Inc.
  • The Boeing Co.
  • Caterpillar Inc.
  • Facebook Inc.
  • Microsoft Corp.
  • PayPal Holdings Inc.
  • Tesla Inc.
  • Visa Inc.

Thursday, 25th April

  • Barclays Inc. (UK)
  • Lloyds Bank (UK)
  • Bayer AG (Germany)
  • com Inc. (U.S)
  • American Airlines Group Inc. (U.S)
  • Ford Motor Co. (U.S)
  • South West Airlines (U.S)

Friday, 26th April

  • Royal Bank of Scotland (UK)
  • Daimler (Germany)
  • Deutsche Bank AG (Germany)
  • Chevron Corp. (U.S)
  • Exxon Mobil Corp. (U.S)

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