Forex Weekly outlook: November 21 – 25

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On Monday, the greenback pushes up to a six month peak in early Asian trading, as investors continued to back bets that the admin of President-elect Donald Trump would start on expansionary fiscal policies and boost development.

Last Friday, the dollar increased to its highest level since April 2003 compared to a basket of the other major currencies, was at 101.41, during a rally motivated by the U.S. presidential election and expectations that the Fed Reserve will increase interest rates the upcoming month.

The dollar increase  to 111.125 yen, its highest since May 31. It was previously down 0.1% at 110.82 as investors placed ahead of the U.S. Thanksgiving holiday later in the week.

The index has increased approximately 3.0% so far this month after the result of the U.S. presidential election, tracking increasing U.S. Treasury yields during expectations that President-elect Donald Trump’s ideas to increase fiscal spending and reduce will spur economic progress and inflation.

More rapid development would spark inflation, which in turn would stimulate the Fed to tighten monetary policy a faster rate than had previously been anticipated.

The greenback recovery has also been increased by bets that the U.S. central bank will almost definitely increase the interest rates the upcoming month.

Federal Reserve Chair Janet Yellen on Thursday reiterated that a rate hike “could well become appropriate relatively soon.”

Investors have given a 95.4% probability of a rate hike at the Fed’s December meeting; according to the reports.

The anticipations for the higher interest rates usually increase the dollar by making it more striking to yield seeking investors.

On Friday, the euro decline  to 11-month lows compared to the dollar, with EUR/USD at 1.0588 in late trade.  During the week,  the pair was down 2.16 percent.

The dollar increase to five-and-a-half month peak against the yen, with USD/JPY surge 0.71% at 110.89 in late trade.

The traditional safe haven Swiss  franc drop to nine month lows against the dollar, with USD/CHF hitting peaks of 1.0122, before moving back  to 1.0099 late Friday.

Sterling slid to two-week lows, with GBP/USD  down 0.61% at 1.2344. 

In the week onward, trade volumes are expected to stay light around Thursday’s Thanksgiving holiday and Friday’s shortened trading period.

The survey data on euro zone private sector business activity is also scheduled on Wednesday, it will be carefully observed for fresh signs on the health of the single currency bloc’s economy.

On Additioanal News

On November 21, Canada is to announce data on wholesale sales.

European Central Bank President Mario Draghi is to affirm about the bank’s Annual Report before the European Parliament, in Strasbourg.

On November 22, New Zealand is to post statistic on retail sales. The UK is to report on public sector borrowing. Canada is to release data on retail sales. The U.S. is to create a report on existing home sales.

Financial markets in Japan will stay closed for a holiday on November 23. New Zealand is to report on producer price inflation.

In the UK, Chancellor Philip Hammond will show his autumn budget statement to parliament.

The euro zone is to publish study data on private sector activity.

On Wednesday, the U.S. is scheduled  to release data on durable goods orders, jobless privileges and new home sales ahead of the holiday.

The Fed is to publish the minutes of its November meeting, later in the day.

Thursday, November 24, the Ifo Institute is to announce data on German business climate.

On Friday, November 25, Japan will release data on consumer price inflation.

The U.K. will round up the week with a brush up data on third quarter progresses.

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