Fundamental Overview

Fundamental Overview USD and Gold: 12th-16th February

Fundamental Overview USD and Gold: Key Economic Events and Forecasts for the Upcoming Week

As the new week approaches, traders and investors must stay informed about high-impact economic events that can significantly influence the trajectories of the US Dollar (USD) and Gold (XAU/USD). This fundamental overview aims to provide insights into key economic indicators, their potential implications on currency and commodity markets, and forecasts for the week ahead.

*USD Fundamental Overview (February 11th Onward):*

**Recent Trends:**
The USD has enjoyed a six-week winning streak, supported by robust US macroeconomic data and a diminishing concern over Omicron-related risks. However, signs indicate a potential easing in its upward momentum.

**Influence of EUR/USD:**
The EUR/USD pair remains pivotal in shaping the US Dollar Index (DXY). Vigilance is advised as developments in the Eurozone can impact the broader USD trend.

High-Impact News Events (February 13th – February 16th)

1. US Consumer Inflation Figures (CPI)

  • Date: February 13, 19:30 (United States)
  • Impact: High
  • The monthly CPI data will be closely watched by traders. Strong inflation figures may boost the Greenback, while weaker data could lead to USD weakness.
  • Forecast: The USD is likely to react strongly to the CPI release. If inflation exceeds expectations, the USD may strengthen as it signals potential rate hikes by the Federal Reserve. Conversely, lower-than-expected inflation could weaken the USD.

2. Retail Sales Reports

  • Date: February 15, 19:30 (United States)
  • Impact: High
  • We’ll see releases related to Retail Sales YoYRetail Sales Ex Autos MoM, and Retail Sales MoM. These reports provide insights into consumer spending trends and economic activity.
  • Forecast: Positive retail sales data could support the USD, indicating a robust recovery in consumer spending. However, disappointing figures may weigh on the USD.

3. Jobless Claims Data

  • Date: February 15, 19:30 (United States)
  • Impact: High
  • Keep an eye on Continuing Jobless ClaimsInitial Jobless Claims, and the Jobless Claims 4-week Average. These figures reflect the health of the labor market.
  • Forecast: A decline in jobless claims would signal an improving job market and could strengthen the USD. Conversely, rising claims may lead to USD weakness.

4. NY Empire State Manufacturing Index

  • Date: February 15, 19:30 (United States)
  • Impact: High
  • The Empire State Manufacturing Index measures business conditions in the New York region. It can provide insights into broader economic trends.
  • Forecast: A positive reading would indicate manufacturing expansion and could bolster the USD.

5. Producer Price Index (PPI)

  • Date: February 16, 19:30 (United States)
  • Impact: High
  • The PPI MoM data reflects changes in wholesale prices. It can influence inflation expectations and impact the USD.
  • Forecast: Higher PPI may lead to inflationary pressures, potentially supporting the USD.

6. Building Permits

  • Date: February 16, 19:30 (United States)
  • Impact: High
  • Building permits data provides insights into the housing market and construction activity.
  • Forecast: An increase in building permits could signal economic growth and benefit the USD.

7. Michigan Consumer Sentiment

  • Date: February 16, 21:00 (United States)
  • Impact: High
  • The Michigan Consumer Sentiment Index gauges consumer confidence. A positive reading may support the USD.
  • Forecast: Strong consumer sentiment could boost the USD, reflecting optimism about economic prospects.

*USD Forecast:*

While the USD has exhibited strength, its trajectory is subject to influences from economic data releases, geopolitical tensions, and global events. Traders are encouraged to stay informed and adapt their strategies accordingly.

*Gold (XAU/USD) Fundamental Overview:*

**Fundamental Factors:**

– Strong US macro data and hawkish FOMC remarks suggest prolonged higher interest rates, acting as a headwind for safe-haven gold.
– A risk-on rally in global equity markets further diminishes gold’s appeal as a safe-haven asset.

**Upcoming Catalyst:**

Investors eagerly anticipate the release of the latest US consumer inflation figures, providing insight into the potential timing and pace of Federal Reserve rate cuts in 2024.

**Gold Forecast:**

The short-term outlook for gold remains bearish, primarily influenced by the current economic climate and monetary policy expectations. However, the tide may shift based on forthcoming economic indicators and global developments.

The information provided here is for educational purposes only and does not constitute financial advice. Always conduct your research and consult with a professional financial advisor before making any trading decisions.
Stay informed and adapt your trading strategies based on these upcoming events.

Add a Comment

You must be logged in to post a comment