Forex Weekly Outlook For September 26–30

Last week, the Federal Reserve kept the interest rates unchanged as expected. However, the monetary policy committee pointed out that a rate hike is possible before the end of the year. Though the Central Bank was confident of the economic growth, it decided to maintain the interest rates at the same level as in the September meeting. Three members had opposed the statement and the rate hike decision is now likely to be taken at the meeting scheduled during December 13 and 14. In the mean time, the policy members reduced the expectations for economic growth and inflation in the current year. The Bank of Japan also did not implement any policy changes, but are now targeting long-term interests rates rather than fully committing themselves to a specific QE target. Meanwhile, talks of a Hard Brexit weighed down the pound, but the euro continued to maintain its frustrating range. The Australian dollar recovered against the kiwi. The key economic data releases scheduled for the current week are as follows:

#1: German Ifo Business Climate (09/26/2016 Monday 8:00 GMT)

forex1In August, the German business climate index declined unexpectedly to 106.2 from 108.3 in the month of July amid Brexit concerns, recording the sharpest decline in over four years. In spite of the words of confidence that the policy makers have issued, economists continue to be concerned about the fact that a weaker external demand could downgrade the outlook for growth in September. For the month of September, economists forecast that the German business climate index will remain at the same level at 106.3.

#2: Swiss National Bank Chairman Jordan Speaks (09/26/2016 Monday 9:30 GMT)

Swiss National Bank governing board chairman Thomas Jordan is due to speak in Geneva at the Sibos 2016. Volatility can be expected during his speeches. This is because the traders try to decipher clues on interest rate changes.

#3: European Central Bank President Mario Draghi Speaks (09/26/2016 Monday 14:00 GMT)

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Chee Hin Teh 5 years ago Member's comment

Thanks for sharing