USD - A Week Packed With Economical Data Expected
During last week's session the Dollar managed to recover against most of the major currencies. The Dollar saw a 300 pips rise against the Euro, and the EUR/USD pair is trade near the 1.47 level. However, the Dollar continued to weaken against the Japanese yen.
The Dollar's recovery appears to be mainly psychologically. Last week did not provide sustain data showing that should have supported the Dollar. It seems to be that the fact that the EUR/USD reached the 1.50 level, a very poor level for the Dollar, the market promptly corrected this situation with a bullish trend for the Dollar.
Last week's data mainly showed that the U.S economy is yet to be seen as a recovered economy. The housing sector, the main reason for the recession, is far from returning to levels seen before the crisis began. The employment condition continues to deteriorate, and the weekly Unemployment Claims rises every week.
Nevertheless, the upcoming week has the potential to create mayhem in the market, as various extremely-impacting news publications are expected from the U.S economy. The main data that traders should focus on is likely to be the Federal Funds Rate and the Non-Farm Employment Change. The Federal Funds Rate is in fact the U.S interest rates announcement for November. Currently, analysts expect the FED to leave the rates at their low level, lower than 0.25%. If the FED will surprise and hike rates, it is likely to boost the Dollar. The Non-Farm Employment Change measures the change in the number of employed people during October, excluding the farming industry. Analysts forecast the 173,000 have lost their jobs during October, and that could be the best figure in 14-months. This also has the potential to boost the Dollar.
EUR - European Interest Rates Announcement Expected This Week
The Euro dropped against all the major currencies during last week's trading session. The Euro lost 300 pips against the Dollar, 300 pips against the Pound and over 600 pips against the Yen.
Two main reasons have led to the Euro's downfall last week. One, the economic data from the Euro-Zone has failed to reach analysts' expectations. The German Consumer Climate, a leading indicator of consumer spending, saw a 4.0 end result, failing to reach expectations for a 4.5 result, falling for the first time in 14 months. The German Retail Sales dropped by 0.5% in September, also showing that the German economy still experiencing difficulties to fully recover. Considering that Germany contains the strongest and biggest economy in the Euro-Zone, the negative data has weakened the Euro. The second reason for the Euro's downtrend seems to be the recovering Dollar. Furthermore, it appears that if the Dollar's correction will proceed, the Euro might continue to weaken.
Looking ahead to the following week, the main data expected from the Euro-Zone will be the Minimum Bid Rate scheduled for Thursday. The Minimum Bid Rate is the Euro-Zone's interest rates announcement for November. The Minimum Bid Rate currently stands on 1.00% and analysts expect it to stay this way. However, if the European Central Bank will surprise and hike rates, it will have the potential to reverse the Euro's bearish trend, and to lift the Euro back up. Traders should also follow the British interest rates announcement whish is due at the same day.
