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THIS WEEK’S MARKET-MOVING EVENTS (all days local) from Econoday
Next week’s economic calendar is packed with key data releases that will offer a clearer picture of the global economic landscape. In Europe, the European Central Bank (ECB) is widely expected to keep interest rates unchanged, with inflation well within its target range. While some industrial production data has been weak, particularly in Germany, a rebound is anticipated. Final consumer price index (CPI) reports from Germany and France are also on the docket, with no significant changes expected from preliminary readings.
Across the United States, attention will be on inflation as the Federal Open Market Committee (FOMC) weighs potential rate cuts. The August inflation reports, including the Producer Price Index (PPI) and the CPI, will be closely watched for any signs that price increases are accelerating, presenting a tricky scenario for policymakers alongside signs of a softening labor market. The consensus points to a month-on-month increase of 0.3% for both PPI and CPI, with year-over-year figures at 3.3% and 2.9%, respectively. Weekly jobless claims are also expected to provide context on the labor market.
In the Asia-Pacific region, the main focus is on inflation and trade data. China’s consumer prices are expected to remain in negative territory, while producer prices show ongoing deflation, though officials haven’t indicated a major policy shift. In Japan, a modest second-quarter GDP growth is anticipated to be confirmed, supported by a rebound in net exports. Australia will also release consumer and business confidence data, likely influenced by the recent rate cut by the Reserve Bank of Australia.
USDX (US DOLLAR INDEX)
Chart shows USDX consolidating between 97.40-60 and 97.90-9820 with higher lows and lower highs but more on the defensive while below 98.00
Using EURUSD as a proxy (57.6% of the index) shows it needing to take out either side of 1.1677-1.1760 for USDX to break key USDX levels.
USDX 1 HOUR CHART
Using my platform as a HEATMAP shows…
…the dollar trading mixed with JPY underperforming while the NZD, AUD and CHF outperform.
USDZJPY has about filled its gap after opening in thr 148s and then backing off.
There has been little attention paid so far to today’s French no confidence vote (scroll below for a preview).
On order of strength vs the USD*
1. NZD
2. AUD
3. CHF
4. EUR
5. GBP
6. CAD
7. JPY
USDJPY
Japan PM’s resignation caught market by surprise and likely leaning the wrong way, thus the opening week gap higher.
At a minimum, political instability should keep the BoJ from hiking rates.
As for USDJPY, still within its range with a bid while above 148 and  the opening week gap below it
On the upside, 148.78 blocks the recent 149.13 high.
USDJPY 4 HOUR CHART
EURUSD Daily
Getting ready for Monday…
EUR managed on Friday to break above 1.17500, and now there is only 1.17900 left before reaching 1.18900
That is going to be one very important level – but we’ll talk about it when / if taken out.
Right now Supports are:
1.17100, 1.16900 & 1.16750
Pattern wise: Monday Up , with a higher high
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