Week Ahead Analysis: 9th January

Week Ahead Analysis

The week ahead looks to be an eventful one, with several key economic indicators set to be released and a speech from Fed Chairman Powell on Tuesday.

On the currency front, the USD is expected to come under pressure, with the release of the CPI figures on Thursday forecasted to come in lower than expected. The CPI m/m is expected to fall from 0.1% to 0.0%. This follows a period of weakness for the USD, with the currency remaining rangebound between 105.50 and 103.50 on the USD Index.

The GBP is also expected to come under pressure, with GDP figures for the month expected to come in lower at -0.3% compared to the previous forecast of 0.5%. This is likely to weigh on the GBPUSD exchange rate, which has been rangebound in recent weeks. However, if the USD weakens further, we could see the GBPUSD move higher towards 1.2300.

The JPY was the strongest currency last week according to the strength meter, while the GBP was the weakest. The USDJPY exchange rate fell from the highs of 134.50 last week, suggesting further downside is likely. The price could continue lower towards 129.00.

Gold

In other markets, the price of gold made a strong breakout higher and is heading towards $1875.00. This comes amid increasing uncertainty in financial markets and could be seen as a safe haven asset.

Overall, it looks set to be a volatile week ahead with several key indicators set to be released and the potential for movement in currencies and other markets. As always, it is important to keep a close eye on these developments and be prepared for any potential market movements.