Weekly News Highlight
U.S. New home sales remain strong in the US, figures show, suggesting that successive interest rate rises have yet to subdue the property market.
Experts believe the impact of months of consecutive rate rises will soon affect the market, with some even forecasting a double-digit fall in sales of new homes this year. The Federal Reserve is expected to raise rates to 5.25% on Thursday.
Effect: If Feds are going to rise rates then, it might hurt the U.S. Economy this time. Usually currency trned to be strong while central banks rise rates but too much pressure on economy is bad for the long run as well.
Oil production in Iraq has hit its highest level since former leader Saddam Hussein was ousted in 2003. Production has risen to 2.5 million barrels per day (bpd) from a steady 2 million bpd during the US-led invasion, Iraq’s new oil minister said.Hussain al-Shahristani added that production was expected to rise to 2.7 million bpd by the end of the year.
“We have been able to break records,” he said of the government, which has been in place for just over a month.
Effect: US CPI will fall due to falling Oil price if the Iraqi supply keep increasing. Which is a good sign as this news says
The ultra discounter said steep gasoline prices prompted customers to make fewer shopping trips, but they stocked up while there, spending nearly 5 percent more per trip. Family Dollar caters to lower-income shoppers who are most sensitive to rising energy costs.
Effect: If the oil keep falling consumer will have more cash on hand to spend which means consumer confidence index will go up and thats a dollar positive sign. I’m going to look south on X/USD pairs such as EUR/USD and AUD/USD this week.
The Bank of England’s interest rate-setting body voted 7-1 in favour of keeping rates at 4.5% in June, minutes show. The Bank of England’s rate-setting body voted 7-1 to hold UK interest rates at 4.5% in June, minutes have shown. The one member of the Bank’s Monetary Policy Committee (MPC) to vote against the freeze was David Walton, who favoured raising rates to 4.75%. It was the second month in a row that Mr Walton had voted for a rise, because of worries over the risk of inflation.
Analysts said the minutes appeared to rule out the chance of a rise in UK rates during the short term.
Effect: I’m hoping that GBP/X pairs will go south as well, mostly against Yen, GBP/JPY might hit 209 this week as
Japanese stocks fell on speculation interest rates will keep climbing in the U.S. as the Federal Reserve attempts to quell inflation, curbing spending in Japan’s largest overseas market.
And this news just hit the stores,
China’s economy will expand faster this year than in 2005 as investment and exports continue to grow, the central bank’s research bureau said. Gross domestic product will probably rise 10.3 percent in the first six months before slowing in the second half for full-year growth of 10 percent, the People’s Bank of China said in a report, published today in the state-owned China Securities Journal. China’s economy grew 9.9 percent in 2005, overtaking the U.K. as the world’s fourth largest.
This will be a fixed week, I’ll be very sensetive to technical indicators as there is no certain trend on dollar unless Feds rise rates. Good luck and happy trading.