The Week Ahead – The ECB, the FED, the UK General Election and Trade in Focus

It’s a big week ahead, with the ECB, the FED, trade, and the UK General Election in focus. Expect the stats to play second fiddle in the week.
Bob Mason
Financial stock market numbers and forex trading graph, business and stock market data, financial investment concept on bull and bear shapes symbols background.

On the Macro

It’s another busy week ahead on the economic calendar, with 48 stats to monitor over the week.

While the stats are on the lighter side relative to the week prior, monetary policy and politics will also be in focus.

For the Dollar:

After a quiet start to the week, November inflation figures get things going on Wednesday. Following the softer Core PCE Price Index figures for October, forecasts are for the annual rate of core inflation to hold steady at 2.3%.

On Thursday, November wholesale inflation figures will also provide direction ahead of a busy end to the week.

On Friday, November retail sales and core retail sales will be in focus. With the holiday season coming up and the U.S equity markets hitting fresh highs late in the year, any weak numbers would weigh heavily on the Greenback.

October inventory numbers will also be in focus on the day.

Through the week, 3rd quarter productivity and unit labor cost numbers on Tuesday and the weekly jobless claims figures on Friday will likely have a muted impact on the Dollar.

On Friday, import and export price index figures will play 2nd fiddle to the retail sales figures.

Outside of the numbers, chatter on trade will continue to provide direction ahead of the FED’s final monetary policy decision of the year.

The Dollar Spot Index ended the week down 0.58 at $97.700.

For the EUR:

It’s also a busy week ahead, on the economic data.

Through the 1st half of the week, trade data out of Germany and economic sentiment figures for Germany and the Eurozone will be in focus.

Expect Germany and the Eurozone’s ZEW Economic Sentiment figures on Tuesday to have the greatest influence.

On Thursday, the Eurozone’s industrial production figures for October are also due out. The markets will be looking for upward momentum to support the view that the economy may have turned a corner.

In the 2nd half of the week, finalized November inflation figures out of Germany, France and Spain will likely have a muted impact on the EUR.

On the monetary policy front, ECB President Lagarde delivers her first policy decision and press conference.

Expect more calls for fiscal support as the ECB looks to shift the onus to member states.

In the week, geopolitics will also be in focus. Chatter on trade will provide direction ahead of the UK General Election on Thursday.

According to the bookies, the opinion polls and the predictors, the Tories are set to seal a majority victory and deliver on Brexit. It wouldn’t be the 1st time that the polls have been wrong, however.

The EUR/USD ended the week up by 0.38% to $1.1060.

For the Pound:

It’s a relatively busy week ahead on the economic calendar.

October manufacturing and industrial production and trade data are due out on Tuesday.

Barring a marked widening in the trade deficit, expect the production figures to have the greatest influence.

On Thursday, the RICS House Price Balance figures for November will likely be brushed aside. It’s Election Day and the fate of Britain’s EU membership may be decided in the coming week.

Expect a rocky ride for the Pound overnight on Thursday as the results begin to trickle in…

The GBP/USD ended the week up by 1.66% to $1.3140.

For the Loonie:

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

Key stats include December housing starts and October building permit figures.

Barring a material deviation from forecasts, the stats are unlikely to have too much influence on the Loonie.

Following last week’s BoC policy decision and rate statement, the markets will be looking towards stats that will influence monetary policy.

The Loonie ended the week up by 0.20% to C$1.3255 against the U.S Dollar.

Out of Asia

For the Aussie Dollar:

It’s also a relatively busy week ahead.

NAB Business Confidence figures and Westpac Consumer Confidence figures due out on Tuesday and Wednesday will provide direction.

With the RBA continuing to highlight uncertainty over consumer spending, expect the Westpac figure to have the greatest force.

Last week, the RBA held back from discussing rate cuts, unlike in the November meeting. Concerns over the impact of rate cuts on consumer confidence ultimately led to a hold on rates. If the RBA’s view holds water, the stance on interest rates should deliver positive numbers.

House price figures due out on Tuesday will also provide direction. Upward momentum in house prices would support a pickup in consumer spending and alleviate some of the uncertainty.

Outside of the numbers, the impact of geopolitics on commodities will also influence.

The Aussie Dollar ended the week up by 1.15% to $0.6841.

For the Japanese Yen:

It’s a busier week than usual on the economic calendar.

Key stats include finalized 3rd quarter GDP numbers on Monday and BSI Large Manufacturing Index figures for the 4th quarter on Wednesday.

The focus will then shift to the Tankan survey numbers that are due out on Friday.

With the U.S – China trade war in full swing, in spite of ongoing talks, the numbers may reflect the negative conditions across the manufacturing sector in particular.

Outside of the stats, the impact of geopolitics on risk sentiment will also be key.

The Japanese Yen ended the week up by 0.83% to ¥108.58 against the U.S Dollar.

For the Kiwi Dollar:

It’s a quiet week ahead on the economic calendar. Economic data is limited to November electronic card retail sales on Wednesday and Business PMI numbers on Friday.

Expect the numbers to have a material influence on the Kiwi. The RBNZ has held back from another rate cut. Any dire numbers and expect the chances of a rate cut to build going into the New Year.

The Kiwi Dollar ended the week up by 2.24% to $0.6566.

Out of China

It’s a quiet week on the economic data front. November inflation figures are due out, which will have a muted impact on market risk appetite.

With the U.S due to roll out fresh tariffs on the 15th December, the markets are going to need some good news…

The Yuan ended the week down by 0.03% to CNY7.0349 against the Greenback.


Impeachment: While it is worth keeping an eye on proceedings, continued Republican support leaves the chances of Trump being thrown out of office limited at best.

In the week ahead, Trump’s impeachment is expected to go ahead… We can expect Trump’s Twitter account to be particularly active. It remains to be seen, who will fall victim to Trump’s ire…

Trade Wars: Still no end in sight. The only positive was China’s more measured retaliation to Trump signing the HK Bills. Both sides are likely to be eager to deliver a phase 1 agreement before the end of the year.

For the U.S administration, a positive on the trade front would distract the markets from the anticipated impeachment.

With the U.S – China negotiations reportedly close to a conclusion, Trump has already shifted focus to the EU and LatAm.

Expect any widening of the trade war net to test risk appetite in the week.

UK Politics: It’s the week of the UK General Election. Pound volatility will likely spike, with results from constituencies due to start trickling in late in the European session on Thursday.

The Pound has chosen Boris Johnson, so expect a tumble should early results see the Tories lose key seats. Marginal seats are expected to decide the outcome of the election…

Monetary Policy

ECB: No surprises are expected on Thursday, which makes the press conference the key driver on the day. It will be Lagarde’s 1st delivery that should garner plenty of attention. Anticipate calls for member state governments to loosen the purse strings to be the theme.

FED: The markets are not expecting any surprises, in spite of some mixed numbers out of the U.S last week. An upward revision to 3rd quarter growth has given the FED more breathing space. While the hold is expected, there will be some uncertainty over the economic projections.

Are the FOMC members aligned with FED Chair Powell’s positive outlook? Nonfarm payroll and wage growth figures would have provided some relief after disappointing private sector PMIs last week.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.