The Week Ahead – COVID-19, Economic Data, and Monetary Policy in Focus

On the Macro

It’s a relatively busy week ahead on the economic calendar, with 49 stats in focus in the week ending 26^th November. In the week prior, 60 stats had been in focus.

For the Dollar:

Early in the week, prelim private sector PMIs for November will be in focus on Tuesday.

While we expect the services PMI to have the greatest impact, sub-components of the Manufacturing PMI will also influence.

Delivery times, price pressures, and employment will likely be key areas of focus.

With the U.S markets closed on Thursday, the markets will need to be prepped for a Wednesday data dump.

Key stats will include jobless claims, core durable goods, core PCE price index, and personal spending figures.

3^rd quarter GDP numbers are also due out. Barring any revisions from previous estimates, however, the numbers should have a muted impact on the markets.

Of greater influence, will be the FOMC meeting minutes due out on Wednesday

In the week ending 19^th November, the U.S Dollar Index rose by 0.95% to 96.031.

For the EUR:

On Monday, flash Eurozone consumer confidence figures will be in focus. With consumption key to the economic recovery, the numbers tend to have a material impact.

Following news updates from EU member states of lockdowns, however, upbeat numbers may have a muted impact.

The focus will then shift to prelim November private sector PMIs for France, Germany, and the Eurozone. We can expect interest across the sub-components and cost pressures in particular.

In the 2^nd half of the week, the German economy will be in focus.

On Wednesday, German business sentiment figures will draw interest ahead of 3^rd quarter GDP numbers on Thursday. Consumer climate figures for Germany will also influence on Thursday.

For the week, the EUR slid by 1.35% to $1.1290.

For the Pound:

It’s a quieter week ahead on the economic calendar.

Prelim private sector PMIs for November will be key in the week. Expect the Services PMI to have the greatest impact.

The Pound ended the week up by 0.28% to $1.3451.

For the Loonie:

It’s a particularly quiet week ahead on the economic calendar.

There are no material stats due out of Canada to provide the Loonie with direction.

The Loonie ended the week down 0.72% to C$1.2640 against the U.S Dollar.

Out of Asia

For the Aussie Dollar:

It’s a relatively quiet week ahead, with key stats limited to private new CAPEX and retail sales figures.

Construction work done figures for the 3^rd quarter are also due out but should have a muted impact on the Aussie Dollar.

The Aussie Dollar ended the week down by 1.32% to $0.7235.

For the Kiwi Dollar:

It’s a big week ahead.

On the economic data front, retail sales and trade data will be in focus.

The main event of the week, however, will be the RBNZ monetary policy decision on Wednesday. Will there be move hikes on the horizon to curb inflationary pressures?

The Kiwi Dollar ended the week down by 0.57% to $0.7004.

For the Japanese Yen:

Prelim November private sector PMIs will be in focus on Wednesday.

Expect the services PMI to have the greatest impact ahead of inflation figures on Friday.

The Japanese Yen fell by 0.09% to ¥113.990 against the U.S Dollar.

Out of China

It’s a particularly quiet week ahead on the economic calendar.

There are no material stats due out of China to provide the markets with direction.

While there are no stats, the PBoC will be in action at the start of the week. The markets are not expecting any moves on loan prime rates, however.

The Chinese Yuan ended the week down by 0.12% to CNY6.3871 against the U.S Dollar.

Geo-Politics

Nothing new to consider in the week ahead, with China and Capitol Hill continuing to be the key areas of focus.

COVID-19

News of rising new COVID-19 cases and the reintroduction of lockdown measures will remain a key driver in the week ahead.

Expect any new lockdown measures across Europe to further test support for riskier assets.