Alpesh Patel's NEWSLETTERPRO - How will Janet Yellen's speech affect major currencies' outlook?

Share On Facebook
share on Linkedin
© Alpesh Patel

The week started off with a peaceful and uneventful trading session yesterday with the major currency pairs we monitor demonstrating low volatility.

The Euro remained pretty much stable for the entire day hovering around the 1.3650 area and only during overnight trading hours it popped above that to reach 1.3680. There was little in the news to drive the European currency anywhere and investors are waiting for this week’s important events before committing to any further moves.

The Pound also remained range-bound yesterday and held on to recent gains to stay above the 1.6400 mark. The Bank of England’s Inflation Report tomorrow will be the key focus for the British currency this week but we expect increased volatility today in the Pound, as well as in the Euro, as the new Fed Chairwoman will be delivering her speech to the House.

So, time has finally come to hear from Janet Yellen for the first time after she got the Fed job and investors regard her first speech as very important. The Fed Chairwoman will be addressing several issues on her speech and she will be answering lawmakers’ questions at the same time.

One of the key issues she’s bound to address is the recent slowdown in growth in the job sector. The 2 recent jobs reports missed the market’s expectations and especially the December reports shocked investors and harmed the Dollar’s outlook at that point. We’re very interested to hear whether she’s worried about this development. Although it’s almost certain that she will state that she’s not we will need to read between the lines and assess how much truth there is in that.

Also a very important issue is the tapering agenda and whether she will go ahead as rumored with regular $10b cuts every month. The US economic recovery is proving fragile from the moment the Fed pulled the trigger back in December and it’s of the utmost importance to listen how she’s planning on moving forward. Again, the most obvious answer will be that further cuts are data-dependant but her tone and any signs of optimism or concern will be reflected on the Dollar’s price.

Important news events today and tomorrow

The key event of the day will be Janet Yellen’s speech to the House in the US and we’ll be monitoring her remarks closely as the US lawmakers will be expressing their concerns over recent developments in the recovery efforts.

Yellen will be aiming to be very responsive to their questions but at the same time give away as much as possible as one of her primary mandates is to keep volatility to a minimum. However, her tone and probably the way she expresses herself are bound to reveal some of her thoughts and investors will want to move on this.

The rest of the day is empty of other important events and our focus will turn to tomorrow’s Inflation Report coming from the UK and this is also a key event for this week. We’ll be speaking about this in more detail in our report tomorrow.

Economic Calendar

Time

Currency

Event

Importance

Forecast

Previous

15.00

USD

Fed’s Yellen delivers Monetary Policy Report

Medium

 

 

TECHNICAL ANALYSIS & LEVELS

EUR/USD

GBP/USD

FTSE 100

Gold

This is the freely distributed Morning Brief section of the NewsletterPro report, a subscription-based product.
If you would like to receive the full version of the report along with specific trading suggestions, please subscribe by clicking here

 

Disclaimer Notice

Past performance is not indicative of future results. Trading forex, CFDs and equites carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade any such leveraged products you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading on margin, and seek advice from an independent financial advisor if you have any doubts.

The information provided by InvestingBetter.com should not be relied upon as a substitute for extensive independent research which should be performed before making your investment decisions. InvestingBetter.com are merely providing this information for your general information. The information and opinions presented do not take into account any particular individual’s investment objectives, financial situation, or needs. All investors should obtain advice based on their unique situation before making any investment decision and should tailor the trade size and leverage of their trading to their personal risk appetite.

InvestingBetter.com and/or its owners will not be responsible for any losses incurred on investments made by readers and clients as a result of any information contained on InvestingBetter.com. InvestingBetter.com does not render investment, legal, accounting, tax, or other professional advice. If investment, legal, tax, or other expert assistance is required, the services of a competent professional should be sought.

 

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

Leave A Reply

 
Do you want to write for our Newspaper? Get in touch: newspaper@advfn.com

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V: D:20200806 07:25:54