This week the focus of attention will be on the Bank of England’s policy decision, the US CPI data and the China CPI so the instruments to have in mind are GBPUSD, EURUSD and AUDUSD and how they may react.
BoE decision → GBPUSD
The Bank of England’s policy meeting will take place on Thursday at 11:00 GMT. A rate increase of 25bps is already priced in, so attention will shift to any indications or announcements about future policy. As a result, the pound is unlikely to react to a 25bps increase. GBPUSD is travelling around the one-year high of 1.2556, indicating that more gains are expected.
US CPI → EURUSD
Wednesday’s release of the US CPI for April is likely to be the highlight in the US. The headline rate is anticipated to remain unchanged at 5.0% y/y, while the core rate is anticipated to have fallen to 5.5% from 5.6% y/y previously. EURUSD failed several times to surpass the 13-month peak of 1.1095, but the outlook remains bullish in the long-term.
China CPI → AUDUSD
China’s trade data, which is coming out on Tuesday, may get some attention from aussie traders, since China is Australia’s biggest trading partner. Also, the CPI and PPI for China will be released on Thursday. AUDUSD is currently recording its sixth consecutive green day but is holding within a two-month consolidation area.
This week the focus of attention will be on the Bank of England’s policy decision, the US CPI data and the China CPI so the instruments to have in mind are GBPUSD, EURUSD and AUDUSD and how they may react.
BoE decision → GBPUSD
The Bank of England’s policy meeting will take place on Thursday at 11:00 GMT. A rate increase of 25bps is already priced in, so attention will shift to any indications or announcements about future policy. As a result, the pound is unlikely to react to a 25bps increase. GBPUSD is travelling around the one-year high of 1.2556, indicating that more gains are expected.
US CPI → EURUSD
Wednesday’s release of the US CPI for April is likely to be the highlight in the US. The headline rate is anticipated to remain unchanged at 5.0% y/y, while the core rate is anticipated to have fallen to 5.5% from 5.6% y/y previously. EURUSD failed several times to surpass the 13-month peak of 1.1095, but the outlook remains bullish in the long-term.
China CPI → AUDUSD
China’s trade data, which is coming out on Tuesday, may get some attention from aussie traders, since China is Australia’s biggest trading partner. Also, the CPI and PPI for China will be released on Thursday. AUDUSD is currently recording its sixth consecutive green day but is holding within a two-month consolidation area.
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