US Dollar (USD)
The publication of the latest US consumer price index will be centre stage this week. December’s CPI figures are forecast to report an acceleration of inflation. Expect this to bolster the US Dollar (USD) if it weakens bets for a March rate cut from the Federal Reserve.
Pound (GBP)
Likely driving movement in the Pound (GBP) this week will be the publication of the UK’s latest GDP figures. Analysts forecast the UK economy will have returned to growth in November. Will this ease UK recession fears and help to lift Sterling later in the week?
Euro (EUR)
The Euro (EUR) may struggle at the start of this week in response to some underwhelming industrial data from Germany. EUR investors are likely to look to speeches by European Central Bank (ECB) policymakers for fresh impetus later in the week, with the single currency potentially firming if they continue to push back against interest rate cut speculation.
Australian Dollar (AUD)
Australia will publish its latest trade data later this week. November’s figures may act as a headwind for the Australian Dollar (AUD) if the country’s trade surplus narrowed amid an ongoing lull in export growth.
South African Rand (ZAR)
In the absence of any notable domestic data, movement in the South African Rand (ZAR) is likely to be tied to market risk appetite this week. This may leave the Rand to falter later in the week if Fed rate cut expectations wane.
Canadian Dollar (CAD)
The Canadian Dollar (CAD) could face an uphill battle this week. With CAD data thin on the ground, movement in the commodity-linked ‘Loonie’ may be dictated by oil price dynamics. Will moves by Saudi Arabia to cut prices lead CAD exchange rates to slump?
New Zealand Dollar (NZD)
With domestic data in short supply, the New Zealand Dollar (NZD) is likely to remain sensitive to market risk sentiment this week. Could a more cautious mood lead the ‘Kiwi’ to weaken?