Weekly Outlook: 2014, September 28 - October 05

Forex Weekly Outlook Sep 29-Oct 3

Canadian GDP, US Consumer confidence, ISM Manufacturing PMI, Rate decision in the Eurozone and important employment figures from the US including the all-important NFO report. These are the major events on Forex calendar. Here is an outlook on the main market-movers ahead.

Last week, the Scottish referendum threatening to quit the UK, resulted in a vote against independence pushing the pound higher after sharp drops. Likewise, the US dollar gained momentum as ECB Chairman Mario Draghi, RBA’s Stevens and Chinese policy makers considered using the Fed’s tactics to fight downturn economic trends. Finally the US GDP release showed the economy expanded at an annual rate of 4.6% in the second quarter, better than the 4.2% estimate made a month ago, providing momentum for strong growth the rest of the year. Will the US continue its growth trend?

1. Eurozone Inflation data: Tuesday, 9:00. Euro zone inflation edged up in August 0.3% after posting 0.4% rise in the previous month. The increase was in line with market forecast. The main price increase occurred in rents and car-repair. The Euro area remained in the “danger zone” of below 1% for 11 straight moths. The recent rate cuts and asset purchases are expected to stimulate the economy and boost inflation. ECB next step may involve a more massive bond-buying program. Euro zone inflation is expected to gain 0.3% this time.
2. Canadian GDP: Tuesday, 12:30. Canadian economy expanded 0.3% on a monthly base in June, following a 0.5% gain in May. The reading was better than the 0.2% expansion anticipated by analysts. The increase was driven by an increase in mining and oil and gas extraction offsetting the fall in the manufacturing sector. On a yearly base, GDP edged up 3.1% in June the highest growth rate since September 2011. The Central Bank expects that the economy will expand 2.2% in 2014 and 2.4% in 2015. GDP is forecasted to increase by 0.2% in July.
3. US CB Consumer Confidence: Tuesday, 14:00. US consumer confidence picked up in August, reaching 92.4 from a downwardly revised 90.3 the prior month. The reading was higher than the 89.1 reading projected by analysts and posted the fourth straight rise. Better business conditions and strong job growth boosted consumer’s moral. Consumers also forecasted an inflation rise of 5.5% in the coming 12 months. Consumer confidence is expected to reach 92.2 this time.
4. US ADP Non-Farm Employment Change: Wednesday, 12:15. ADP payroll numbers plunged in August to 204,000, from 212,000 in the previous month. However the ADP figures have proved to be volatile, showing only the general trend of the Non-Farm payrolls coming later that week. Economists expected a stronger release of 218,000. Overall, employment figures remained high, posting the fifth straight month of job gains above 200,000. US job market is expected to expand by 206,000 positions in September.
5. US ISM Manufacturing PMI: Wednesday, 14:00. U.S. manufacturing activity edged up to its highest level in nearly 3-1/2 years in August, rising to 59, after a 57.1 release in July, amid a strong jump of a 3.4% in consumer spending during July, indicating a growth trend in the US economy. Economists expected a reading of 57 points. Private construction, the largest portion of construction spending, rose 1.4%, its highest level since November 2008. U.S. manufacturing is predicted to reach 58.6.
6. Eurozone rate decision: Thursday, 11:45. The European Central Bank cut its benchmark rate to 0.05% in September from 0.15% in August. ECB President Mario Draghi noted the rate cut reached the lower bound following a downturn trend in the Eurozone economy with low inflation, sinking deeper below the ECB’s target of just under 2 %. The ECB also lowered the rate on bank overnight deposits to -0.20%. No change in rates is expected now.
7. US Unemployment Claims: Thursday, 12:30. The number of people filing initial claims for unemployment benefits increased by 12,000 last week to 293,000, after contracting sharply two weeks ago. However despite the sharp rise, the level of applications remains near pre-recession levels, indicating that hiring remains strong. Over the past year, the four-week average for applications has fallen 7.1%. The total number of people receiving benefits ticked up by 7,000 to 2.4 million. He number of claims is expected to rise to 299,000.
8. US Non-Farm Employment Change and Unemployment rate: Friday, 12:30. The US economy added 142,000 jobs in August, the lowest figure this year after a 212,000 rise in July. The sharp fall came as a surprise to analysts, expecting a gain of 226,000. However, the unemployment rate declined to 6.1% from 6.2% in the previous month, in line with market forecast. The US had added an average of 212,000 jobs each month over the prior 12 months. While the monthly release was weaker than anticipated, the longer-term trend remains positive. Gains now average 207,000 over the last three months. A gain of 216,000 jobs is expected in the NFP report.
9. US Trade Balance: Friday, 12:30. The U.S. trade deficit narrowed in July to its lowest level since January, reaching to a seasonally adjusted $40.5 billion, from $40.8 billion in June.
   Exports of automobiles, telecom equipment, industrial machines and semiconductors increased. Imports of oil products increased, but rising domestic production reduced the trade deficit in petroleum to its lowest in more than five years. The decline in trade deficit reinforces views that the US economy continues to strengthen. The U.S. trade deficit is expected to decline further to $41.0 billion in July.
10. US ISM Non-Manufacturing PMI: Friday, 14:00. The U.S. service sector continued to expand in August, reaching 59.6 after gaining 58.7 in July, beating forecast of 57.3. The majority of responders were optimistic regarding business conditions. The business activity index showed a reading of 65, up from July’s reading of 62.4; the new orders index hit 63.8, down from the previous reading of 64.9 and the employment index rose to 57.1, from July’s reading of 56. Overall, the ISM manufacturing and non-manufacturing reports suggest a continued improvement in the U.S. economy. US ISM Non-Manufacturing PMI is forecasted to reach 58.5.

Dollar Looks to Close Out Best Quarter Since Great Financial Crisis

Fundamental Forecast for Dollar: Neutral

• The US Dollar has rallied for a record 11 consecutive weeks, and the quarter is on pace for a 7-year record
• Fed forecasts have done much of the heavy lifting to this point, but risk trends are increasingly important

Attachment 9823

We are only a few days from the close of the US Dollar’s best quarterly performance since the third quarter of 2008 – at the height of the financial crisis. Back then, the greenback was charging higher as panicked investors were seeking haven for their capital. Few assets and region’s could offer the level of safety traders were seeking, and the world’s most heavily used reserve currency backed by the largest economy stood as a beacon of shelter. Yet, with the current 11-week rally – the longest on record – circumstances are much different.

Volatiltiy levels are close to record lows and investors are still more concerned about yield than they are safety. ‘Fear’ is all consuming and reinforcing, thereby making it a strong fundamental backbone for the currency. Is the dollar’s current drive as enduring? Are there other outlets of strength ready to supplement bulls’ ambitions?

To this point, there have been two primary motivators for the Dollar: rate expectations and the relative deterioration of its major counterparts. Between the two, exceptional weakness for the Euro, Yen , Australian and New Zealand dollars is responsible for the bulk of the USDollar’s 6.4 percent climb over the past two months. With the Eurozone facing economic headwinds and a increasingly desperate ECB, Japan keeping the course on its open-ended stimulus program, Australia suffering China’s managed economic moderation and the Kiwi reeling from rate expectaitons whiplash; there was a potent appetite for strength and stability.

The question moving forward is whether the most liquid counterparts to the dollar will continue to face hardship that redirects capital towards its borders. From an economic standpoint, a downturn in developed and developing world forecasts bolster the robust US outlook. The monetary policy contrast is similarly paced in the Dollar’s favor. While the timing and pace for the FOMC’s return to rate hikes is up for significant debate, even a period of basing would outweigh the active growth in accommodation by the Fed’s three largest counterparts: ECB, BoJ and the PBoC. That said, a considerable discount has been afforded to these imbalances. Further progress requires development of these concerns.

Though it may be in second place as market impetus, rate speculation has played a considerable role in the Dollar’s progress. The central bank has just this month reiterated a forecast that a first hike is likely to come in the middle of next year and further upgraded its expectations for the pace of tightening. Yet, on this point, there is room for confidence or doubt to seep in. Where the currency and medium-term Treasury yields (2-year) have advanced, other key market elements have rebuffed the scenario. Fed Funds futures – which are direct hedges to rate forecasts – are showing a dramatic discount to the Fed’s own forecasts. Meanwhile, the ‘low volatility / high risk exposure’ conditions derived from the current glut of stimulus, remain undisturbed.

If there is one particular avenue of untapped potential that can most effectively charge the Dollar higher, it is a full-scale risk aversion – the source for the last rally of a comparable magnitude to this quarter. Volatility levels have not rocketed higher outside of the short-term build around scheduled event risk. However, there is a slow and steady build behind these measures. Volume has slowly started to pick up as well while tallies show capital outflows in riskier asset classes. This is an underlying current that will not shift all at once. That said, a sentiment change can carry the dollar much further than the other top fundamental themes. This week, the NFPs is top event risk, but Monday’s PCE inflation figure is just as important a factor in the Fed’s dual mandate – and thereby rate forecasting. If there is one outlet capable enough to unseat global risk trends, it may very well be monetary policy.

British Pound Goes Back to Basics – Yields Point to GBP Strength

Fundamental Forecast for British Pound: Bullish

• British Pound may have set lasting low versus US Dollar
• Sterling may indeed continue higher versus the Euro and other major counterparts

Attachment 9824

The British Pound traded higher versus all G10 counterparts save the US Dollar and Japanese Yen. Why might it continue higher through the foreseeable future?

There’s relatively little in the way of foreseeable economic event risk out of the UK next week, and that may in fact play in the domestic currency’s favor. It was only two weeks ago when GBP/USD volatility prices traded to multi-year peaks, and a negative correlation between vols and the GBP helped explain why it fell sharply on clear uncertainty. Yet in a remarkable shift in sentiment, the Sterling now boasts the lowest volatility prices of any G10 currency. If correlations hold firm, this may be enough of a reason for continued appreciation.

A key exception comes from final revisions to Q2 Gross Domestic Product growth numbers due Tuesday, but surprises are relatively unlikely and only a big miss would force important GBP volatility. Beyond that, traders will keep an eye on the usual slew of early-month US economic event risk—especially the end-of-week US Nonfarm Payrolls report. With the Scottish Independence Referendum now past, the UK currency can return to basics and trade off of traditional fundamental factors. Credit Suisse Overnight Index Swaps show that the Bank of England will raise benchmark interest rates by approximately 0.50 percentage points in the coming 12 months. This may not seem like much, but it is only second to the US Federal Reserve (and US Dollar) at +0.58%.

http://youtu.be/7U1AKVDNCQM

The clear divergence in growth and yield expectations between the UK and other major economies leaves the GBP in the position of strength. And though an obvious US Dollar uptrend makes us reluctant to buy into GBPUSD weakness, we believe the UK currency could trade higher through the coming week and perhaps month.

AUD Eyes 2014 Low As Yield Appeal Wanes Amid Volatility Swell

Fundamental Forecast for Australian Dollar: Bearish

• AUD/USD Remains Exposed As Volatility Swell Saps Carry Demand
• High Threshold For Upcoming Regional Data To Catalyze A Recovery
• Bearish Technical Signals Leave Sights Set On 2014 Lows Near 0.8660

Attachment 9825

The Australian Dollar faced another week of heavy selling pressure as traders likely unwound carry trades amid of a surge in market volatility. Further, a void of major domestic economic data left the currency lacking bullish fundamental cues to catalyze a recovery.
The coming week brings a raft of local releases including building approvals, trade balance data and retail sales figures. Yet based on recent RBA rhetoric these are unlikely to materially shift policy expectations. This suggests the potential impact on the Aussie from the figures may be muted. In turn the AUD may be left looking elsewhere for sources of support.

Also on the docket will be the release of the official and final HSBC manufacturing figures from Australia’s largest trading partner, China. The upside surprise to last week’s preliminary PMI data failed to leave a lasting positive impact on the currency. This suggests there is a high threshold for Chinese data to generate a rebound for the AUD.

The key risk facing the Aussie remains the prospect of a mass exodus from carry trades. A rebound in measures of implied volatility suggests traders are anticipating large swings amongst the major currencies. This detracts from the attractiveness of the Aussie’s comparative yield advantage and leaves it vulnerable to further weakness.

Traders have their sights set on the 2014 lows for AUD/USD near 0.8660. While the magnitude of recent declines may open the door to some profit-taking, this may slow its descent rather than prompt a reversal. Refer to the US Dollar outlook for insights into the USD side of the equation.

Gold Down 5% in September- $1206 Support in Focus Ahead of ECB, NFPs

Fundamental Forecast for Gold: Neutral

• Gold Rebounds Near Huge 1206 Level; 1240 is Resistance
• Gold Regains Footing Before US Data, Yet Is There Room For A Recovery?

Attachment 9826

Gold prices are virtually unchanged this week with the precious metal off just a fraction of a percentage point to trade at $1213 ahead of the New York close on Friday. The decline marks the fourth consecutive week of losses for bullion as relentless strength the greenback and easing geopolitical tensions continued to weigh on demand. Month-to-date gold is off by 5.6% with prices down more than 8.4% quarter-to-date. As we head into the close of September trade however, the near-term outlook becomes

That economic docket picks up considerably next week with the European Central Bank interest rate decision and the US Non-Farm Payroll report highlighting the calendar. Expectations are that the ECB will unveil a massive stimulus package with some estimates calling the European version of QE to top 1Trillion Euros. The US employment report on Friday will central focus next week with consensus estimates looking for a 213K gain in September with the headline unemployment rate holding steady at 6.1%. Should the data disappoint, look for gold to likely remain supported in the near-term as the greenback takes a reprieve with the Dow Jones FXCM Dollar Index posting its 11th consecutive weekly advance this week as prices pushed into fresh 4-year highs.

While our broader outlook for gold remains weighted to the downside, we’ll take a more neutral stance as we head into the October open while noting that seven of the last ten years have seen strong performances in gold for the first week of Q4. Of those seven instances, bullion prices saw an average gain of 1.89% and as such, we’ll look to the October opening range for further guidance on our medium-term bias.

From a technical perspective gold defended a critical support target this week at $1206- a level defined by the close of the 2013 December 31st candle- which was the low day of the year. A break below this threshold targets support objectives at the 100% Fibonacci extension taken off the 2014 March high at $1193 and the 2013 stretch lows at $1178. Note that the momentum signature is back above the 30-barrier with a topside resistance trigger off the July highs pending. Near-term resistance is eyed at the June lows at $1240/43 with only breach above $1260 shifting the focus back to the long-side of the trade.

Nikkei forecast for the week of September 29, 2014, Technical Analysis

The Nikkei went back and forth during the course of the week as you can see, pressing up against the ¥16,300 level. The fact that we are broken above the ¥16,000 level tells us that we are ready to break out even further, and head towards the ¥20,000 level. We have absolutely no interest whatsoever in shorting this market, and will only buy it. If we fall from here, we will simply look for supportive candles in order to start going long yet again. We believe that the Nikkei is heading to ¥20,000 given enough time.

http://youtu.be/FcjMHEQuVr8

Attachment 9869

DAX forecast for the week of September 29, 2014, Technical Analysis

The DAX as you can see fell during the course of the week, testing the €9500 level. The area should be somewhat supportive, but we also believe that the €9400 level below is massively supportive also. So having said that we feel that this is a market that you can only buy, and even if we broke down below there you can see that on the longer-term charts the €9000 level is also supportive. So that being the case, we are simply waiting for some type of supportive candle in order to start buying the DAX again.

http://youtu.be/7OVZYIZlCO4

Attachment 9870

NASDAQ forecast for the week of September 29, 2014, Technical Analysis

The NASDAQ fell during the bulk of the week as you can see, but found enough support to bounce towards the end. The resulting candle looks as if it has found support near the 4500 level, so we believe that there will be bullish pressure going from here. After all, the market is without a doubt bullish overall, so we have no interest in selling. We are buying supportive candles in this area, or even impulsive candles but believe that the trigger for buying will probably come from shorter-term charts.

http://youtu.be/SjjVC6M7D7g

Attachment 9871

MIB forecast for the week of September 29, 2014, Technical Analysis

The Milanese exchange fell during the bulk of the week, but as you can see found enough support near the 20,300 level to turn things back around and form a hammer. This hammer of course suggests that the market is ready to go higher again. With that, we would be buyers on a break above the top of the hammer for the week, expecting this market to eventually head to the 22,400 level. With that being said, we are bullish overall, and believe that the MIB will see an influx of “hot money” again.

http://youtu.be/tRt1jJekp-k

Attachment 9872

IBEX forecast for the week of September 29, 2014, Technical Analysis

The IBEX fell initially during the course of the week, but found the €10,700 level to be supportive enough to turn things back around and form a nice-looking hammer. With that being the case, the market looks as if it’s ready to go higher, and a break above the top of the hammer has this market looking for the €11,200 level. The pullbacks on short-term charts will continue to be buying opportunities but we do think that the €11,200 level will be broken to the upside given enough time. Because of this, we are very bullish.

http://youtu.be/9XrMbCP84go

Attachment 9873

CAC forecast for the week of September 29, 2014, Technical Analysis

The Parisian index fell during the course of the week, but found the 4350 level to be supportive enough to turn things back around and form a nice-looking hammer. The hammer of course suggests that the market is going to go higher, and as a result we believe that we will test the €4500 level for resistance yet again. With this, we are bullish of this market, and will continue to buy pullbacks as they appear on the short-term charts as well. We believe ultimately that the Parisian index will go to the €4600 level again.

http://youtu.be/oGZ2Z2c-LHw

Attachment 9874

S&P 500 forecast for the week of September 29, 2014, Technical Analysis

The S&P 500 fell during most of the week, but as you can see bounced enough to form a little bit of a hammer like candle. The 1980 level looks as if it’s going to continue to send buying pressure into the marketplace, thereby giving the buyers the upper hand going forward as we expect. The 2020 level been broken to the upside of course is a very bullish sign, just as a supportive candle in this general vicinity would be. We have no interest whatsoever in selling this marketplace.

http://youtu.be/Sq3Ea7ahZfg

Attachment 9875

Dow Jones 30 forecast for the week of September 29, 2014, Technical Analysis

The Dow Jones 30 as you can see fell during the majority of the week, but found enough support near the 17,000 level again to form a hammer. Because of this, we believe that the Dow Jones 30 is going to continue going higher, and a break above the 17,300 level would be a sign that the market is ready to continue the long trend higher. However, we think there is plenty of support below, so even a pullback doesn’t dissuade us from being positive of this very bullish market.

http://youtu.be/5P39vhBsvLA

Attachment 9876

Silver forecast for the week of September 29, 2014, Technical Analysis

Summer markets fell during the bulk of the week, but found enough support near the $17.50 level to bounce and form a little bit of a hammer for the week. However, we think that we have broken down through significant support, and any bounce from here is more than likely going to end up being a selling opportunity. With that, we are still bearish of the summer market and have no interest in buying. In fact, the other signal for us would be a break down below the bottom of the hammer, which of core show significant weakness.

http://youtu.be/Ybt-DUnIsoo

Attachment 9877

Gold forecast for the week of September 29, 2014, Technical Analysis

The gold markets tried to rally during the course of the week, but as you can see fell down almost immediately. The resulting candle is a shooting star, which of course is very negative looking at the bottom of a downtrend. Where the very bottom of the consolidation that we had seen down in this general vicinity, and as a result it looks like we are going to try to make an attempt to break down below the $1200 level. If we get that move, this market could go as low as $1000. If we break above the $1250 level, at that point time we think the market would then head to the $1350 level as it would continue the consolidation that we’ve seen for some time now.

However, gold markets are very sensitive to the value the US dollar, which of course is continuing to gain serious strengthen overall. With that, gold markets probably are going to break down, and a move below $1200 would be a big surprise at all. The gold markets continue to suffer as the US dollar is being bought because of the lack of economic growth around the world, ultimately making it the only asset that a lot of traders will hold onto.

If we do break the top of the shooting star though, we feel that the market will try to pick up steam and although we are calling for a move to the $1350 level, we recognize that we could go as high as $1400 as well. With that being the case, we recognize that a decent trades set up is coming, but we need to break out of the candle from the previous week in order to feel comfortable enough to put any real money into this marketplace.

We also recognize that sooner or later we will find support, probably closer to the $1000 level, and that being the case we would be very interested in going long of gold down in that region if we get a supportive candle for a longer-term trade. However, right now things simply look to soft.

http://youtu.be/0-u52usZOkg

Attachment 9878

USD/CAD forecast for the week of September 29, 2014, Technical Analysis

The USD/CAD pair broke higher during the course of the week, slicing through the 1.10 level yet again. In fact, we closed at roughly 1.1150, which means that we are starting to dig into the resistance and heading towards the 1.12 handle. Because of this, we feel that the market will ultimately his that level, and then break above there in order to start offering more longer-term trades. We think that pullbacks continue to offer value, and will find them time and time again. We have no plans whatsoever on selling.

http://youtu.be/kQh3Zg0fnaQ

Attachment 9879

USD/JPY forecast for the week of September 29, 2014, Technical Analysis

The USD/JPY pair initially fell during the course of the week, but found enough support near the 108 level to turn things back around and form a hammer at the top of a very strong move. Because of this, it appears that the market is ready to continue going higher, but we do recognize of the 110 level just above is going to be resistive. Because of this, we are bit hesitant to start buying but recognize that a daily close above the 110 level is probably enough of a reason to start buying this market yet again, as it most certainly cannot be sold at this point in time.

Truth be told, the 105 region with much more resistant than the 110 region is on the longer-term charts, so it would not surprise us at all if we continue going higher. We won’t lie though, we would prefer to see a pullback in order to collect more buyers going forward as a US dollar should continue to gain against the Japanese yen overall. After all, the two central banks are completely diametrically opposed when it comes to monetary policy, and as a result this should be a “one-way bet” given enough time.

The market has a massive floor and it down at the 105 level even if we do pullback, and all that would do is have us buying aggressively at that point in time on supportive candles. We see no reason to think that this market is going to break down now, and even if we get something like a shooting star at the 110 level, we are not interested in selling, we just look at it as a sign that the market was ready to take a little bit of a break. Because of that, we are simply not interested in selling whatsoever, as the markets have no sign of pulling back for any real length of time. Ultimately, we think that this market will continue to go higher over the next several years, and that the long-term trend has started.

http://youtu.be/z-49HQ7BTiE

Attachment 9881

NZD/USD forecast for the week of September 29, 2014, Technical Analysis

The NZD/USD pair fell off of a cliff during the week, slicing through the 0.80 handle with relative ease. Because of that, it appears of the market should continue to drop down to the 0.76 handle first, and then ultimately the 0.75 level which of course is a large, round, psychologically significant number. Keep in mind that the commodity markets most certainly are not helping the New Zealand dollar, so with that it’s likely that the Kiwi dollar will continue to lose value over time. We have no plans whatsoever in buying.

http://youtu.be/wtERuzdOnXg

Attachment 9882

GBP/USD forecast for the week of September 29, 2014, Technical Analysis

The GBP/USD pair initially tried to rally during the course of the week, but then turned back around to fall and close near the 1.6250 region. The hammer just below from two weeks ago of course should provide plenty of support though, so we feel that this market will more than likely continue to grind sideways in this region a for finally making its move. That being said though, at this point in time we favor the upside in this market based upon the technical factors on this chart such as the hammer from the 50% Fibonacci retracement level.

http://youtu.be/samGZmZa7Y4

Attachment 9884

EUR/USD forecast for the week of September 29, 2014, Technical Analysis

The EUR/USD pair initially tried to rally during the week, but as you can see ended up falling and slicing through the 1.28 level like it wasn’t even there. Because of this, we believe that the euro continues to offer selling opportunities on rallies, but at this point in time we think that the market is probably aiming for the 1.25 handle. Be aware though, this is a market that is certainly oversold by any stretch of imagination and a snapback rally could happen at any point. Ultimately though, we have no plans on buying.

http://youtu.be/a1nhjNFShAY

Attachment 9885

Forex - Weekly outlook: September 29 - October 3

The dollar rose to fresh six year highs against the yen on Friday and hit 14-month peaks against the euro after data showed that the U.S. economy grew at its fastest pace in two-and-a-half years in in the second quarter.

USD/JPY hit highs of 109.52, the most since August 2008 and was last up 0.49% to 109.26.

EUR/USD was at lows of 1.2682 late Friday, the weakest since November 2012.

The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies ended Friday’s session up 0.51% to a four year high of 85.77, capping its eleventh consecutive weekly gain.

The dollar was boosted after the Commerce Department reported that U.S. gross domestic product was revised up to 4.6% in the three months to June from a previous estimate of 4.2%. It was the fastest rate of expansion since the fourth quarter of 2011.

The upbeat data added to the view that the strengthening economic recovery may prompt the Federal Reserve to raise interest rates sooner than markets are expecting.

In contrast, the Bank of Japan and the European Central Bank look likely to stick to a loose monetary policy stance amid concerns over faltering economic growth.

The pound fell to more than one week lows against the stronger dollar, with GBP/USD down 0.44% to 1.6243 late Friday. Elsewhere, sterling was close to two year highs against the single currency, with EUR/GBP at 0.7806 in late trade.

The commodity linked dollars fell to multi-month lows against the greenback. AUD/USD was down 0.29% to an almost six month trough of 0.8761 late Friday, while NZD/USD hit one year lows of 0.7860. USD/CAD was up 0.44% to 1.1156, the highest level since March.

Also Friday, the Russian rouble fell to a fresh record lower against the greenback, with USD/RUB up 1.69% to 39.14 in late trade. The rouble was pressured lower by falling oil prices. Crude oil is one of Russia’s largest exports.

In the week ahead, investors will be looking ahead to euro zone inflation data and the outcome of Thursday’s ECB meeting, while Friday’s U.S. nonfarm payrolls report will also be in focus after August’s report fell short of expectations. Wednesday’s Japanese manufacturing data will also be closely watched.

Monday, September 29

• In the euro zone, Germany and Spain are to release preliminary data on consumer price inflation, which accounts for the majority of overall inflation.
• The U.K. is to release a report on net lending.
• The U.S. is to produce data on personal income and expenditure, as well as a private sector report on pending home sales.

Tuesday, September 30

• New Zealand is to release data on building permits, in addition to a private sector report on business confidence.
• Japan is to publish reports on household spending, retail sales and average earnings, as well as preliminary data on industrial production.
• Meanwhile, China is to publish the final reading of the HSBC manufacturing index.
• The euro zone is to release preliminary data on consumer inflation and unemployment, while Germany is to publish data on retail sales and unemployment.
• The U.K. is to report on preliminary business investment and the current account and IS TO release final data on GDP growth. The country is also to produce private sector data on house price inflation.
• Switzerland is to publish its KOF economic barometer.
• Later Tuesday, Canada is to release its monthly GDP report along with data on raw material inflation.
• The U.S. is to publish data on business activity in the Chicago region and a report on consumer confidence.

Wednesday, October 1

• Japan is to publish the results of its Tankan manufacturing and services indices.
• Markets in China are to remain closed for a holiday, but the country is to release official data on manufacturing activity.
• Australia is to publish data on retail sales.
• The U.K. is to publish data on manufacturing activity.
• The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Late in the day, the Institute of Supply Management is to release a report on manufacturing activity.

Thursday, October 2

• Markets in Hong Kong will be closed for a national holiday.
• Australia is to release data on building approvals and the trade balance.
• In the euro zone, Spain is to release a report on the change in the number of people unemployed.
• The U.K. is to publish data on construction activity.
• The ECB is to announce its benchmark interest rate. The announcement is to be followed by a press conference with President Mario Draghi.
• The U.S. is to publish the weekly report on initial jobless claims, as well as data on factory orders.

Friday, October 3

• Markets in China will be closed for a national holiday.
• The euro zone is to release data on retail sales, while markets in German are to be closed for a holiday.
• The U.K. is to publish data on service sector activity.
• Both Canada and the U.S. are to report on the trade balance.
• The U.S. is to round up the week with what will be closely watched government data on nonfarm payrolls and the unemployment rate, while the Institute of Supply Management is to release data on manufacturing activity.

Traders utilizing this indicator are generally worried about utility creation, which can be extremely volatile since the utility business, and thus, the trading of and interest for vitality is vigorously influenced by changes in climate. Critical revisions between reports can be brought about by climate changes, which thus can cause instability in the country's currency.