FOMC interest rate decision the key market moving event this week
During the upcoming trading week interest rates are heavily in focus as we see important interest rate decisions from the US Federal Reserve, Bank of England and the Bank of Japan. The FOMC rate decision and monetary policy statement are likely to set the tone for the foreign exchange markets this week, with market participants looking for the FOMC’s economic projections and clear forward guidance on any potential interest rate reductions as the United States economy begins to slow.
Aside from central bank action, the economic calendar remains exceptionally busy with the release of the Reserve Bank of Australia Meeting Minutes, New Zealand GDP and a raft of high-impact macroeconomic data from the United Kingdom and German economies.
Monday 17th June, US Empire States Manufacturing Index
The United States Empire State Manufacturing Index measures the level of a diffusion index based on surveyed manufacturers in New York state. It is widely considered a leading indicator of economic health for the American economy. Businesses react quickly to market conditions and changes to the index as sentiment can be an early signal of future economic activity such as spending, hiring, and investment.
- The USDJPY pair is only bearish while trading below the 109.00 level, key support is found at the 108.00 and 107.10 levels.
- If the USDJPY pair moves above the 109.00 level, buyers will likely test towards the 109.45 and 1.1000 resistance levels.
Tuesday 18th June, AUD RBA Meeting Minutes
The Reserve Bank of Australia Monetary Policy Meeting Minutes are published two weeks after the Reserve Bank of Australia interest rate decision. The RBA Meeting Minutes give a full account of the policy discussion, including factors that influenced policy makers decision and differences of view amongst RBA members.
- The AUDUSD pair is bearish while trading below the 0.6930 level, key technical support is found at the 0.6860 and 0.6810 levels.
- If the AUDUSD pair trades above the 0.6930 level, buyers will likely test towards the 0.6980 nd 0.7020 levels.
Wednesday 19th June, USD FOMC Rate Interest Decision
The Federal Open Market Committee meets eight times per year to decide on United States monetary policy and where to set the nations interest rate. Rate changes impact interest rates for US consumer loans, bonds, mortgages and the US dollar exchange rate. The decision of the FOMC policy statement is usually very important, maybe more important than the actual interest rate move made by the central bank, due to it being highly anticipated by market participants. The policy statement includes hints for the future and contains the central bank’s collective outlook on the economy
- The USDCHF pair is bullish while trading above the 0.9990 level, further gains towards 1.0050 and 1.0100 levels remain likely.
- If the USDCHF pair trades below the 0.9990 level, sellers may test towards the 0.9910 and 0.9845 support levels.
Thursday 20th June, JPY BOJ Interest Rate Decision
The Bank of Japan Interest Rate Decision is released by the Bank of Japan and is a consensus between the central banks board members on where to set the rate of interest. The members of the Bank of Japan meet once a month for two days to discuss economic developments inside and outside of the country. Changes in the rate have wide consequences, affecting consumer loans, mortgages, bonds and the exchange rate of the Yen.
- The USDJPY pair is bullish while trading above the 112.90 level, further gains towards 113.50 and 114.54 levels seems likely.
- If the USDJPY pair moves below the 112.90 level, sellers may test towards the 112.00 and 111.50 support levels.
Friday 21st June, EUR EU Manufacturing PMI
The Manufacturing Purchasing Managers Index is released by Markit Economics and is an important indicator of business conditions and the overall economic conditions inside the eurozone economy. EU PMI data is a very important sentiment reading, not only for manufacturing but also the economy as a whole. Most economists are expecting a 50.6 reading in June, marking a slight expansion in manufacturing activity inside the eurozone economy.
- The EURUSD pair is only bearish while trading below the 1.1260 level, further losses towards the 1.1170 and 1.1110 levels remains possible.
- If the EURUSD pair trades above the 1.1260 level, buyers are likely to test towards the 1.1300 and 1.1360 resistance levels.