Next week, investors’ eyes will all be on US inflation in July, expected to slow slightly but still above 5%, due out on Wednesday 11 August.
“Confirmations of persistent inflationary pressures would return to favor the greenback, but in order for the dollar to start a more lasting recovery it is necessary that the other growth data, especially with reference to the labor market, also confirm the solidity of the recovery in place” , commented the experts of Intesa Sanpaolo’s research department in today’s ‘Forex Flash’, noting that in order to proceed towards tapering, the Fed wants to observe significant progress on both fronts.
Among the other data to follow, experts report, in particular the second estimate of GDP of the second quarter (especially because the first reading had disappointed) on August 26, and the ISMs, manufacturing and non-manufacturing, respectively, on September 1 and 3. . Before the FOMC on September 22, the Fed will also have the employment report of September 3 and the new inflation data available on September 14. Meanwhile, to follow the evolution of the Fed’s thinking, the various scheduled speeches will be monitored, with particular attention to the Jackson Hole speeches (26-28 August).