FX Week Ahead Overview:
- The Bank of England’s concerns about UK growth will soon be realized, as the upcoming UK GDP report is expected to show no growth for the three months through May.
- The June US inflation rate (CPI) report will give the ammunition the Federal Reserve needs to justify another 75-bps rate hike later this month.
- The Bank of Canada will likely raise rates by 75-bps this week, the largest rate increase since August 1998.
For the full week ahead, please visit the DailyFX Economic Calendar[1].
07/12 TUESDAY | 09:00 GMT | EUR Eurozone ZEW Economic Sentiment Index (JUL)
Ongoing war in Eastern Europe, continued elevation in energy prices, and slumping growth conditions have seen the Euro[2] crash to its lowest level versus the US Dollar[3] in two decades. And now that markets are beginning to question the viability of the European Central Bank’s efforts to prevent fragmentation in bond markets, Eurozone economic sentiment is likely to slump to its lowest levels of 2022. A test of parity - a 1.0000 exchange rate - in EUR/USD[4] rates increasingly appears to be a question of when rather than if.
07/13 WEDNESDAY | 06:00 GMT | GBP Gross Domestic Product (MAY)
The Bank of England has been issuing caution about the UK’s growth trajectory for several months now, and those fears are being close to realized as incoming UK GDP data appears to be disappointing. According to a Bloomberg News survey, the three-month growth rate is set to fall to 0%, while year-over-year reading is expected to decline from +3.4% in April to +2.7% in May. The BOE’s balancing act between fighting multi-decade highs in inflation and a slowing UK economy has the central bank
