All three major central banks who met this week have decided to maintain their respective rates. The Reserve Bank of Australia, European Central Bank, and Bank of England all maintained their rates (2.50 percent, 0.15 percent, and 0.50 percent, respectively).
On the global employment front, New Zealand led with a better-than-expected Unemployment Rate of 5.8%, while the Employment Change grew 0.4 percent (versus 0.7 percent forecast). Canada’s Employment Change grew only 0.2k (versus 25.4k forecast), with the Unemployment Rate coming in at 7 percent as expected. Meanwhile, Australia posted the worst statistics among the three as the Australian Bureau of Statistics reported that Employment Change declined 0.3k (when analysts expected a 13.5k advance) and Unemployment Rate soared to 6.4 percent, the highest reading since late-2002. Spain’s Unemployment Change posted -29.8k (-116.3k forecast).
Commodities
Gold made a strong recovery this week after suffering from three consecutive weekly declines. Price took out the $1,300 level quite easily and is now looking to cement support in that area. If it can do this successfully, then we can expect a move to test sellers around $1,350-$1,400.
Oil ended the week in the middle of $97 after a $2 decline which transpired. Price action showed a marked contrast from the previous week’s $5 drop. Bulls have a chance to bring price back up toward $100. Otherwise, bears can swing this back to their control and aim for a break of $95-$96 this week.
Currency Pairs
EURUSD hit its fourth straight weekly decline this week; however it has become apparent that bulls are getting more restless. If we can get a weekly close above 1.3400, we could see bulls fight back very soon.
GBPUSD continued to decline this week, marking its fourth consecutive weekly decline. The weekly close ended near the weekly low, indicating there is still a lot of bearish momentum in this pair. Sellers are still on track to reach 1.6700 if their control over this pair persists throughout the week.
USDJPY saw a tug of war between the USD and JPY as each jostled for supremacy in this week’s price movements. JPY got the upper hand, though, and this enabled the pair to close the week in its favor. However, 102 seems to be providing support so anything can happen this week. Bulls want a move through 103, while bears need a decisive break below 102.
The Week Ahead
Monday will largely be quiet with only a few economic releases, such as Japan’s Tertiary Industry Activity; Switzerland’s Retail Sales; and Canada’s Housing Starts.
Tuesday will start quite early with UK’s BRC Retail Sales Monitor. This will be followed by Australia’s NAB Business Confidence and HPI; China’s New Loans; Germany and Eurozone ZEW Economic Sentiment; and US JOLTS Job Openings.
Wednesday will get very busy with Japan’s BOJ Monetary Policy Meeting Minutes and Prelim GDP; Australia’s Wage Price Index and Westpac Consumer Sentiment; China’s Industrial Production and Fixed Asset Investment; UK Average Earnings Index, Jobless Rate, and Claimant Count Change, as well as BOE Inflation Report; Eurozone’s Industrial Production; US Retail Sales and Business Inventories.
Thursday will be equally as busy with New Zealand’s Business NZ Manufacturing Index and Retail Sales; Japan’s Core Machinery Orders; Australia’s MI Inflation Expectations; France’s Prelim GDP and Prelim Non-Farm Payrolls; ECB Monthly Bulletin; Eurozone CPI and Flash GDP; US Jobless Claims and Import Prices.
Friday, meanwhile, will have moderate news activity with UK’s Second Estimate GDP; Canada’s Manufacturing Sales; US PPI, TIC Long-Term Purchases, Empire State Manufacturing Index, Industrial Production, Capacity Utilization Rate, and Prelim UoM Consumer Sentiment.
