Market Brief 17 July: Major currencies gaining against the dollar
Last week we saw the dollar lose ground against the basked of major currencies. On Friday, The U.S. currency depreciated due to weaker than expected inflation data plus falling consumer prices and retail sales for the month of June. Today we have four major market moving events on the calendar.
China (and its significance on the Australian dollar)
CNY and AUD, 03:00 a.m. GMT+1, GDP (YoY) (Q2)- the fastest growing economy in the world is expected to have grown 6.8% in the second quarter verus 6.9% for the previous one. As you know, gross domestic product measures the change in the production of goods and services in the economy. It’s the most important indicator of the health and performance of the economy.
Since more than three quarters of Australia’s exports are direct to Asia, the growth of China has a direct impact on the Aussie currency. If we see that the Chinese economy has grown more than the expected 6.8%, this should be read as a bullish sign for the Australian dollar. And,if the economy has slowed down in its growthm with lower than expected GDP results, this should be seen as a bearish sign for the Australian currency.
EUR 10:00 a.m. GMT +1, CPI (YoY) (Jun)- the crucial Consumer Price Index measures the change in prices from the perspective of the conusmer. Analysts forecast no change in inflation for the month of June, seeing it at 1.3%,same as last time. If the actual number is better than expectedm this should be read as a boosting sign for the euro. However, if the result is lower than expectations, this could weaken the value of the currency.
NZD, 23: 45 p.m. GMT +1, CPI (QoQ) (Q2)- the new Zealand dollar will see volaility coming from this high-impact event. Analysts forecast consumer inflation decrease to 0.2% for the month of June in the second quarter of the year copared to 1.0% for the previous quarter. If the actual reading is better than expectedm this should further strengthen the NZD.And if, the result is stikingly lower than expected, this should be a negative indication for the New Zealand dollar.
Wishing you Successful trading!
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