GBP/USD traders braced for a busy week, starting with UK GDP

Key Movers

The DXY hit a high of 96.69 after US President Trump said it was “probably too soon” to be meeting with the Chinese President. Hopes that a trade deal can be reached to stop a new round of U.S import tariffs on Chinese imports coming into force in March seem to be on the back burner yet again. If an agreement is not met, tariffs on USD 200bn worth of Chinese goods will rise from 10% to 25%.

Market participants are awaiting a raft of delayed US data in the wake of the shutdown of the Federal government. This includes durable goods orders, retail sales growth, core inflation and Q4 GDP growth which will probably be released during the week. Fed Chair Powell is also due to speak on Tuesday.


The euro closed the week at close to two-week lows, with support coming in at and around the 1.1300 figure against the greenback. Last week we saw the single currency post its steepest weekly drop (decline of 1.1 percent) against the dollar in over four months in the wake of data that showed an economic slowdown in Europe was spreading.

On the data front, there aren’t any relevant macroeconomic releases scheduled today. Looking ahead this week and we will see the release of Industrial Production for the month of December, Q4 Gross Domestic Product for both Germany and the EU and Q4 EU flash employment data. Finally, on Friday we will see the release of EU Trade Balance for the month of December.


AUD/USD rebounded early this morning in thinner trading conditions, but has since settled lower and is now trading close to Friday’s closing level at .7090.

The next macroeconomic releases are scheduled for Tuesday and Wednesday, with the Australian Bureau of Statistics releasing their Home Loans data, showing the change in number of new loans granted for owner-occupied homes. Major banks NAB and Westpac will also release their own data regarding business confidence and consumer sentiment respectively.


The Canadian dollar strengthened against the greenback on Friday on the back of surprisingly strong local economic data. USD/CAD moved from levels around 1.3325 down to 1.3232 following an impressive January employment report. Statistics Canada revealed that the number of employed in Canada rose by 66.8k in January, driven by jobs for youth in services and record private-sector hiring, a sign of strength in an economy facing several other headwinds. Economists were forecasting only a 5k employment increase in January. Despite that increase, the unemployment rate rose to 5.8% amid a higher participation rate.


NZD/USD pushed higher into the end of the week last week and has held firm through most of the overnight session, opening in London at .6760.


This week looks to be another big week for the New Zealand dollar with the RBNZ set to release their monetary policy statement on Wednesday, in which there may be reference, direct or otherwise, to the weak NZ employment report last week.