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Economic data coming up in the European session

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A couple of light releases to kick start the new week

The US non-farm payrolls report last week was a solid one and that has helped to keep the dollar elevated and Treasury yields afloat, with the latter in particular going to be a key focus still as we get things going on the week.

10-year yields have moved up to 1.30%, closing in on the 21-26 July highs as well as its 200-day moving average, after establishing a double-bottom at the 20 July low near 1.13%. Push above 1.30% and it will be a break in the recent technical momentum.

USGG10YR

That is likely to put further pressure on gold and pull yen pairs higher.

As for the dollar, the stronger jobs report definitely helps to keep the Fed on track for a taper announcement by year-end and even if the delta variant spread brings about a risk aversion push in the market, the greenback can benefit from such flows.

So, that is likely to limit any drop in the dollar, all things considered.

US CPI on Wednesday will be the key risk event this week, so expect the market to keep the focus on Treasuries, risk sentiment, and the technicals for now. Besides that, keep a look out for more Fedspeak ahead of Jackson Hole at the end of the month.

0545 GMT – Switzerland July unemployment rate

Prior release can be found here. The Swiss jobless rate is estimated to tick a little lower as some improvement is observed in labour market conditions as of late. That fits with the recovery narrative in Europe amidst the summer.

0600 GMT – Germany June trade balance data

Prior release can be found here. German trade conditions have picked up rather well, especially imports, but these are still testing times with the delta variant presenting a fresh risk for foreign demand so we’ll see how things keep up in the months ahead.

0800 GMT – SNB total sight deposits w.e. 6 August

Your weekly check of the deposits kept at the SNB by Swiss banks. This data is a proxy for FX interventions.

0830 GMT – Eurozone August Sentix investor confidence

Prior release can be found here. Investor morale is expected to keep thereabouts as seen in July as economic sentiment holds up in the euro area after the more upbeat summer mood last month, as virus restrictions are eased across the region.

That’s all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.

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