Weekly Outlook: 2017, May 21 - May 28

The US dollar was on the back foot, suffering some political issues among other factors. The meeting minutes from the Fed stand out, alongside updates on US and UK GDP but perhaps the biggest event is the testimony of James Comey. Here are the highlights for the upcoming week.

1. US New Home Sales: Tuesday, 14:00. A level of 611K is on the cards now.
2. Canadian rate decision: Wednesday, 14:00.
3. US Existing Home Sales: Wednesday, 14:00.
4. James Comey testifies Wednesday, 13:30 (tentative). The former FBI Director returns to Capitol Hill for the first time after he was fired by President Trump. Comey’s memo included a passage suggesting that Trump tried to intervene in the investigation of Michael Flynn, the disgraced National Security Advisor about the connections between Russia and the Trump campaign. We have witnessed how the scandals have affected the US dollar. If Comey clearly says that Trump tried to obstruct justice, the dollar could fall. If he denies it or plays Trump’s comments down, the dollar could rise.
5. FOMC Meeting Minutes: Wednesday, 18:00. In the May meeting, the Federal Reserve left interest rates unchanged and shrugged off the recent slowdown. Since then, we learned that wages have decelerated to 2.5% y/y and we have also learned about unimpressive retail sales and lower inflation. Since the meeting minutes document can be revised to send signals to markets, we might get a more dovish message than the statement suggested.
6. UK GDP (second release): Thursday, 8:30. The number will likely be confirmed now.
7. US jobless claims: Thursday, 12:30.
8. US GDP (second release): Friday, 12:30.
9. US Durable Goods Orders: Friday, 12:30. Core orders, which the Fed eyes, were flat after the revision.

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