The U.S. dollar recently witnessed one of the biggest weekly gains since February. This unique circumstance has occurred as investors shifted to safe havens after consumer sentiment data fueled concern about the U.S. debt ceiling and monetary policy.
The dollar index is up 1.40% at 102.70 since its biggest weekly rise in February.
Bullions retreated from the weekly high following the strength in the dollar. Gold prices made a high of 61651 and settled at 60887. Silver plunged more than 5% and after, hitting a weekly low of 72506, settled at 73054
Base metals came under pressure last week. After hitting a weekly low of 725.40, Copper prices settled at 729.00, with a loss of 1.96%. Aluminum settled down by 0.82% at 206.35. Zinc prices plunged by 3.51% and settled at 229.80.
Crude prices retreated from the weekly high of 6060 and settled at 5773, down by 1.16% as the market balanced supply fears against renewed economic concerns in the United States and China.
Important Economic Data and Events
China
A bunch of economic data has been released from China, some of them Retail sales, industrial production and fixed asset investment suggesting that it will impact the market.
Retail sales data is expected to come at 22.00%, much higher than the previous 10.6%.
Industrial Production y/y data is foreseen at 10.9%, much higher than the previous 3.9%.
Fixed Asset Investment ytd/ data is foreseen at 5.7% higher than the previous 5.1%.
U.S.
Appearances by Several central bank officials will be closely watched next week.
Michael Barr, the Fed’s vice chair for supervision, is going to testify before Congress about recent strains in the banking industry and the central bank’s response. On Friday, Fed Chair Jerome Powell and former Fed head Ben Bernanke are ready to take part in a panel discussion on monetary policy in Washington.
The U.S. will also release April data on retail sales on Tuesday, with retail sales expected to rebound by 0.8% from -1.0.
On Thursday, the weekly report on novel unemployment claims is expected. Data have foreseen at 251k lower from the previous week of 264k.
Meanwhile, uneasiness over a potential U.S. default as early as June 1st has been weighing in on investors. This has occurred amid a stalemate in Congress over raising the borrowing limit.
All the above data and events will hold volatility in the dollar.
U.K.
Tuesday’s jobs report’s wage component data will be closely watched. Data is foreseen at 31.2K, slightly higher from the previous 28.2 K.
The Bank of England has stated that the wage and inflation figures before that meeting will decide whether or not rates be increased once more.
BOE Gov Bailey Speaks on Wednesday will bring clutter for the pound.
Eurozone
The Eurozone is to release revised data on Industrial Production m/m data on Monday with a forecast to have a contraction of 2.5% from 1.5% from the previous.
On Tuesday, revised first-quarter GDP numbers were released, with an unchanged 0.1% projection from the prior report.
On the same day, ZEW Institute surveys of business conditions and sentiment in Germany, the largest economy in the region, will be made public. Data is foreseen at -1.%, -5.4% against the previous month of 6.4 and 4.1%, respectively.
All the above data will have a negative impact on the Euro.
India
India WPI is set to be released on Monday which will bring clutter for the pair. Data is expected to have a contraction of 0.20% from 1.34%.