FOMC Not the Only Thing on the Calendar Affecting Dollar (page 2 of 2)

In the week ahead, the abundance of US data may mean that the market pays less attention to Eurozone economic data. However, we are expecting a few key releases including German IFO, unemployment, retail sales and French consumer confidence, GDP and unemployment that is still worth watching.

British Pound

With no economic data on the UK calendar, the British Pound was pushed higher by dollar weakness. It is quite clear that the dollar was the primary driver of Euro and Pound movements because EUR/GBP ended the day unchanged.

Yet as we mentioned yesterday, this is the calm before we get a ripple of data in the week ahead. Growth seems to be the focus around the world as the UK joins France and the US in releasing its GDP figures for the fourth quarter. Additionally, the UK will also be releasing their current account, CBI distributive trades report, house price figures and consumer confidence.

Judging from the forecasts, analysts are expecting stronger reports from our friends across the Atlantic.

Japanese Yen

The Japanese Yen experienced quite a bit of volatility today. Before the release of the US durable goods number, the dollar quietly continued its climb against the Yen, driving the pair to a high of 118.50. However once the US numbers were released, the dollar began to tumble, erasing all of the day's initial gains and taking the pair down to low of 117.40.

Data released overnight was positive for the Yen, with the tertiary activity index rising 2.2 percent versus the market's consensus forecast for 1.4 percent growth. However, the Yen still weakened going into the US session as traders became nervous about whether the US would brand China as a currency manipulator. In the week ahead, Japan too has a great deal of data due for release including retail sales, industrial production and consumer prices.