Finally: Some Economic Data

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coffee2It’s Wednesday, but we just had two whole weekdays with no major economic data releases of any real importance. That all changed today with central bank input from the European Central Bank on the Euro, important GDP data on the British Pound, and later we will also be getting the release of the minutes of the last meeting of the U.S. Federal Reserve.

There were no major surprises within the British data. Although Manufacturing Production data came in stronger than expected, the headline GDP number matched the expected barely-there growth of 0.2%.

The European Central Bank left its main refinancing rate unchanged, as expected, and added no details on TLTROs, which excited the market in last month’s dovish surprise. The Euro saw some movement, but the volatility was relatively minor for such a major event as the ECB’s monthly statement. The EUR/USD currency pair has traded within a mere 60-pip range today so far, as at the time of writing.

The remaining item is tonight’s FOMC Meeting Minutes, whose major item of interest will probably be any language which outlines more explicit criteria for future adjustments to interest rates. However, the FOMC recently having made clear there would most likely be no further rate changes in 2019, that is relatively unlikely to have much effect upon the U.S. Dollar or any other market.

Elsewhere in the market, to me the most interesting thing going on right now is the strength of the Mexican Peso, which is close to making a new near 6-month low price against the U.S. Dollar. A close tonight at the end of the New York session of the USD/MXN currency pair below 18.75 would suggest a further fall would be the most probably outcome tomorrow.

The Turkish Lira also remains weak, although the previously very high relative volatility seen a week or two ago has cooled down dramatically. A strong close above 5.8129 in the USD/TRY currency pair could indicate the start of a further upward movement.

 

 

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment.