The forex trading week: what’s on the cards?

 

With a new foreign exchange trading week now here and underway, it’s a good time to assess what’s coming up between now and Friday.

Monday is, as usual, likely to be a fairly quiet day on the economic calendar.

The only major event scheduled in is the ISM manufacturing purchasing managers’ index from the US, covering the month of February.

This is due to come out at 3pm GMT and is expected to show a change from 50.9 to 50.4.

Looking ahead to Tuesday, things are likely to get significantly busier.

The Reserve Bank of Australia is set to release its interest rate decision at 3:30am GMT.

It is considered likely that this will show no change from its current position of 0.75%.

The release of the decision will be quickly followed by a statement.

Traders will be keeping a close eye on whether the Bank issues any comment about the coronavirus.

This virus has caused problems for the Australian currency due to the trading relationship between Australia and China.

In Switzerland, data on the country’s gross domestic product will be released at 6:45am GMT, covering Q4 of 2019.

It is expected that this will show a change from 0.4% to 0.2% on a quarter on quarter basis.

On a year on year basis, however, it is believed that the metric could show a change from 1.1% to 0.8%.

Traders of the single European currency are likely to keep the 10am GMT timeslot free to check on the preliminary core consumer price index covering February.

Year on year, this is expected to show some slight growth from 1.1% to 1.2%.

There is also likely to be a political dimension to Tuesday’s trading too.

In the US, the Democratic Party will hold its “Super Tuesday” of primary votes, which could play a significant role in deciding who becomes the nominee to run against Donald Trump in November.

Current frontrunners include the moderate former Vice President Joe Biden and the radical candidate Bernie Sanders.

There is likely to be slowdown in trading volumes in Japan on Tuesday too.

This is due to the Greenery Day bank holiday which will see banks and financial institutions closed.

The day will be rounded off by a speech from the US Federal Reserve’s Charles L. Evans, who serves as the president and chief executive officer of the Federal Reserve Bank of Chicago.

Looking ahead to Wednesday, Australia will be in the news early on with a gross domestic product release covering Q4 of 2019.

This will be out at 12:30am GMT.

On a quarter on quarter basis, it is expected that this will show a change from 0.4% to 0.5%.

Year on year, however, it is likely to show a change from 1.7% to 2%.

The economic impact of the coronavirus will no doubt be back in the spotlight at 1:45am GMT when the Caixin services purchasing managers’ index release – covering February – comes out of China.