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Monday, June 19, 2017

Currency Market Trend Analysis: June 19, 2017

Currency Market Trend Analysis: June 19, 2017
Source: CXI International Payments Team

 

 

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By The Numbers: Your FX Week In Review

 
 
Foreign currency value versus USD is decreasing
 
Foreign currency value versus USD is increasing

*Indicators show the percent change over the past week.

Currency Calendar

Date Releases / Holiday Country
June 19, 2017 Buba President Weidmann Speech Germany
June 19, 2017 Start of Brexit Negotiations UK
June 20, 2017 Fed’s Stanley Fischer Speech USA
June 20, 2017 Wholesale Sales Report (Apr) Canada
June 20, 2017 BOE’s Governor Carney Speech UK
June 21, 2017 Public Sector Net Borrowing Report UK
June 22, 2017 Housing Price Index (Apr) USA
June 23, 2017 Markit Manufacturing PMI (Jun) USA
June 23, 2017 Markit Services PMI (Jun) USA
June 23, 2017 New Home Sales (May) USA
June 23, 2017 CPI (May) Canada

Upcoming bank holidays and impactful report releases for select countries.

Market Analysis

CAD - Canadian Dollar

The CAD opened last week at 0.7426 and closed at 0.7555. 

The CAD rallied against the USD this past week, appreciating 1.75% and recovering much of the ground lost over the past 2 months. This appreciation is in-part due to a shift to tightening bias by the BoC. Recent Canadian economic reports have been positive, and housing price growth has accelerated. 

Expect the CAD to appreciate further against the USD this week, though likely at a more tempered pace than last week. 

 

1. Wholesale Sales (Apr): Tuesday June 20.

2. CPI (May): Friday June 23.

 

GBP - British Pound

The GBP opened last week at 1.2743 and closed at 1.2776.

Last week the GBP appreciated 0.25% against the USD. The biggest upset occurred Thursday, following Tuesday’s higher-than-expected CPI inflation report; the Governor of the BoE announced that it is not time to hike interest rates, citing subdued inflationary pressure. Brexit negotiations began Monday, June 19th. Chancellor Hammond has stated that the financial services industry is the highest priority in the negotiations. 

Last Thursdays’ 5-3 vote on the interest rates hike indicates a split within the BoE – there will be a heightened focus Carney’s speech on Tuesday. Expect heightened volatility this week, and possible devaluation. 

 

1. Start of Brexit Negotiations: Monday June 19.

2. BOE's Governor Carney Speech: Tuesday June 20.

3. Public Sector Net Borrowing (May): Wednesday June 21.

4. MPC Member Haldane SpeechWednesday June 21.

 

EUR - Euro

The Euro opened last week at 1.1195 and closed at 1.1191. 

Over the past week, the Euro has depreciated 0.04% against the USD, remaining relatively unchanged. The German IFO institute raised their GDP growth forecasts up – from 1.5% to 1.8% for 2017, and from 1.8% to 2.0% for 2018. 

There are a variety of economic reports coming out this week for the European Monetary Union (EMU), culminating with the release of the PMI for the service and manufacturing sectors. Expect a possible devaluation as Brexit negotiations begin.   

 

1. Buba President Weidmann Speech (Germany): Monday June 19.

2. ECB's Non-monetary Policy Meeting: Wednesday, June 21.


 

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About the Author

Collin McAliley

 Collin McAliley - Financial Analyst

Collin educates corporate clients on foreign currency markets lending industry best practices that enhance client knowledge and create specialized solutions that fit each business. Interested in having a custom international payments strategy or foreign exchange risk plan?

 

 


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