The US dollar may receive a boost later this week if the latest core PCE price index reports that inflation pressures in the US remained persistent last month.
Pound (GBP)
UK Prime Minister Kier Starmer’s meeting with US President Donald Trump will be closely watched by GBP investors this week. A positive rapport between the two may be supportive of the pound (GBP) in the second half of the session.
Euro (EUR)
The results from Germany’s election over the weekend could help to underpin the euro (EUR) through the first half of this week. However, the single currency may then face some resistance towards the end of the session if preliminary CPI data reports a cooling of German inflation this month.
US dollar (USD)
The publication of the latest core PCE price index will be in the spotlight for USD investors this week. If we see another rise in the Federal Reserve’s preferred indicator for inflation, it may lead to further trimming of Fed rate cut bets and bolster the US dollar (USD).
Australian dollar (AUD)
Australia will publish its latest monthly CPI indicator this week. This is forecast to report Australian inflation edged up to a five-month high in January. The Australian dollar (AUD) may strengthen if this weakens bets for another interest rate cut from the Reserve Bank of Australia (RBA) in the near-term.
South African rand (ZAR)
The South African rand (ZAR) may attract support later this week as an expected rise in domestic inflation last month may help temper South African Reserve Bank (SARB) rate cut bets.
Canadian dollar (CAD)
The main catalyst for movement for the Canadian dollar (CAD) this week is likely to be Canada’s latest GDP figures. Economists forecast a modest slowdown in growth in the last quarter of 2024, which might stoke Bank of Canada (BoC) rate cut expectations and pull the ‘loonie’ lower.
New Zealand dollar (NZD)
Notable NZD data is in short supply this week, which may lead movement in the New Zealand dollar (NZD) to be tied to market risk dynamics. Any comments from Trump regarding his tariff agenda could potentially infuse volatility into the ‘kiwi’.
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