ForexBall Education: Major market moving events for 33rd week of 2015

Author Haresh Menghani Category ForexBall News 10 Aug 2015 Updated at 01:17 CET
Last week's NFP data that showed slightly lower-than-forecast addition of 215,000 new jobs during the month of July, attempted to extent support to the already strong US Dollar, which was already higher on the back of strong ISM non-manufacturing PMI print. The ISM non-manufacturing reflected strong activity in US services sector for the month of July and printed the highest reading in more than a decade. Despite of the broader strength in the US economy, drop in ISM manufacturing PMI index and widening trade-balance data for the month of June fuelled uncertainty over the prospects of a September rate hike. Nevertheless, the overall US Dollar Index (I.USDX) added to its monthly gains in July to register its first weekly gain in three weeks.
Going forward, this week's lighter US economic calendar is unlikely to provide any meaningful direction for the market. Investors, however, will look for additional clues to gauge the strength of broader US economic recovery from retails sales data, which happens to be this week's highlight from otherwise a tepid US economic calendar.
Even as the US monthly retail sales unexpectedly dropped in June, market participants are expecting a strong rebound in July and hope the data to continue providing clues of a faster pace of growth in the second half of 2015. The Commerce Department is scheduled to release the data for the month of July on Thursday and consensus estimates are pointing towards a healthy growth with retail sales expected to rise by 0.5% while core retails sales, that excludes automobile sales, also expected to register a gain of 0.5%.

Apart from the US retail sales data, preliminary University of Michigan's consumer sentiment index is scheduled for release on Friday. The Preliminary University of Michigan's Consumer Sentiment Index reading for the month August is expected to improve marginally to 93.5 from a downward revised reading of 93.1 in July. Also watch-out for industrial production data for the month of July, scheduled on Friday and is expected to match previous month growth figure of 0.3% on a month-on-month basis.
Along with the US economic data, notable economic release that could have a material impact on GBP is the UK labor market reports (claimant count change and unemployment rate), scheduled for release on Wednesday. As against consensus forecast of a drop by 8,900, the number of people claiming unemployment-related benefits in June unexpectedly rose by 7,000, lifting unemployment rate to 5.6%. For the month of July too the number is expected to rise by 1,400 but the unemployment rate is expected to hold steady at 5.6%. Weaker-than-expected numbers would point towards fragility of the UK's economic recovery and thus a need for continuity of loose monetary policy to support growth.
Key economic releases scheduled from this week's Euro-zone economic calendar features the first release of the composite Euro-zone GDP data along-with GDP releases from Euro-zone's three largest economies, Germany, France and Italy for the second-quarter of 2015. The flash version of the 17-nation composite GDP, scheduled for release on Friday, is expected to show a growth of 0.4% and Euro-zone's three largest economies, Germany, France and Italy, are expected to have expanded by 0.5%, 0.2% and 0.2% respectively. Meanwhile, the final print of the Euro-zone inflation for the month of July, also scheduled for release on Friday, is expected to remain subdued and match the preliminary release of 0.2%. Other key economic release from the Euro-zone includes German ZEW Economic Sentiment for August, scheduled for release on Tuesday.
Moving on to manufacturing data from the world’s largest manufacturing nation, the latest print for Chinese industrial production for the month of July is scheduled for release on Wednesday and is anticipated to show a further downtick in manufacturing activity and come-in at 6.7% as against a better-than-expected reading of 6.8% in June.
Economy watchers will also have a look at the quarterly retail sales data out from New-Zealand, scheduled for release on Friday. Following an exceptionally strong first-quarter growth of 2.7%, the headline number is expected to post a weaker growth for the second quarter of 2015 with consensus estimating a tepid growth of 0.5%.
Summing it all, this week's US economic calendar, with only the release of monthly retail sales data, lacks any major trigger in the Forex market. However, important releases from other developed economies might continue providing the required momentum for short-term traders.

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