May 24 to May 28 2021
Forex weekly outlook
As usual, before we look forward to what’s going to happen this week, it is always good to remember last week. The US Inflation story is being won by the transitory narrative. This is a major US Dollar negative, as it will mean the US Federal Reserve will likely keep their Interest rate policy very accommodative for much longer.
Friday’s PMI’s were broadly impressive for everyone, with the best performances coming from the UK and the US. The USD caught a bid on the numbers and it has held onto gains to start this week firmer.
The NZD might get interesting depending on what happens at the Reserve Bank of New Zealand’s meeting on Wednesday, it is widely thought that Interest rates will remain unchanged, however, the market is looking for some signs of a change in the Central Bank easy monetary policy.
The data released this week is not particularly that exciting, with the highlight being the second reading of Q1 US GDP on Thursday, on the same day we will also get US Durable Good for April, and the latest reading of US PCE Prices, expected is 3.5%.
Some Federal Reserve speakers this week, will probably all stick to the script of no monetary policy change until full employment, and of course high Inflation is only temporary.
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