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The blowout US Jobs report is likely still fresh in the memory of the Federal Open Market Committee (FOMC) as it looks to keep markets’ bullishness in check. Key data out this week could boost rate hike expectations further with US Retail Sales expected to rise by 0.4% in July, while a rebound in the Uni. of Michigan Confidence print is forecast in August.
Meets or beats on any of the above could heighten the USD’s appeal with Fed officials sure to adopt a more hawkish, though note Chair Janet Yellen could well keep things balanced at the next quarterly policy meeting in September since inflation expectations remain muted.
The increased expectations of a US rate hike in 2016 have conspired with the BoE’s intentions as regards monetary easing to push Cable (GBP/USD) back down towards 1.3. Continued divergence between those two central banks surely sees that trend continuing in the near-to-medium term.
Where the European single currency is concerned, this week’s European Markit PMIs and German IFO confidence and GDP prints would need to deviate considerably from consensus to engender anything big in terms of Euro moves. More likely is a read across from Friday’s Jackson Hole symposium in the US, at which Yellen should give clues about the extent to which US and European policy will diverge.
Key data this week (Sign up here to get our daily live macro-calendar)
Intl Economic Announcements
13:30 Chicago Fed Index (US)
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UK Economic Announcements
09:30 BBA Mortgage Lending Figures
11:00 CBI Industrial Trends Surveys
Intl Economic Announcements
13:30 Durable Goods Orders (US)
15:00 New Homes Sales (US)
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Intl Economic Announcements
07:00 Gross Domestic Product (GER)
12:00 MBA Mortgage Applications (US)
14:00 House Price Index (US)
15:00 Existing Home Sales (US)
15:30 Crude Oil Inventories (US)
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UK Economic Announcements
09:30 Retail Sales
Int. Economic Announcements
07:00 Import Price Index (GER)
09:00 IFO data (GER)
13:30 Initial Jobless Claims, Continuing Claims (US)
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Intl Economic Announcements
07:00 GFK Consumer Confidence (GER)
09:00 M3 Money Supply (EU)
13:30 GDP (Preliminary) (US)
UK Economic Announcements
09:30 GDP (Preliminary), Index of Services
Technicals
Technicals
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