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Weekly outlook of financial market events

The current development of the financial market at the beginning of the new business week, which is marked in the 2023 calendar as the fiftieth in a row, is largely influenced by investment sentiment regarding the meeting of the central bank of the US Federal Reserve System in relation to the level of interest rates. Currently, during the European morning on Monday, December 11, 2023, at approximately 8:48 CET, the US dollar (USD) has so far maintained a trading trend of increasing its exchange value against other major world currencies and the single European currency, the euro (EUR) against the USD so far weakened.

On the indicated day and time, this so-called global currency pair of the single European currency euro (EUR) and the US dollar (USD), as the world’s reserve currency, was traded within the forex operations of the foreign exchange market at the exchange rate at a value of 1.076 USD per EUR with the EUR down by -0.028% against the USD so far. According to analysts, this strengthening trade trend of the USD should last until Wednesday evening, when the members of the FOMC FED will publish their decision on rates, and according to the result of their decision, the reaction of the financial market is expected.

Investors, traders and other participants in this 50th week of 2023 expect, among others, the following events:

CPI US Consumer Price Index – monthly

The monthly Consumer Price Index reflects changes in the prices of consumer goods and services in a given month compared to the previous one. The index shows price changes from the consumer’s perspective. The consumer price index characterizes inflationary dynamics. Its growth can have a positive effect on dollar quotes. The value of the index will be published on Tuesday 12/12/2023 at 14:30 CET and is expected to increase by 0.3% compared to last month.

Gross Domestic Product (GDP) in Britain – monthly

This data is a measure of the total value of goods and services produced in a country. GDP is the most comprehensive indicator of economic performance and provides key insight into the driving forces of the economy. This data will be published on Wednesday 13/12/2023 at 08:00 CET. According to economic correspondents, following economic analysts, a drop in the value of GDP by 0.1% is expected.

FED (Federal Reserve System) interest rate change decision

The FED decides on interest rates on a predetermined date during a vote among the members of the Federal Open Market Committee (FOMC) regarding the Federal Reserve’s short-term interest rates to be charged on loans and commercial bank loans. A rising rate can have a positive effect on the USD, while a falling rate can have a negative effect on it. If the rate remains unchanged, analysts will evaluate the number of votes “for” and “against” and discuss the statements of voters after the minutes of the meeting are published to predict the results of the next meeting. The members of the FOMC FED will meet at a traditional two-day meeting on 12 and 13 December 2023 and on Wednesday 13 December 2023 at approximately 20:00 CET they will announce the results of their decision, and subsequently the head of the FED, Mr. Jerome Powel, will comment on these decisions in a press conference. According to analysts, the interest rate is expected to remain at the current level of 5.25 – 5.5% per year.

US Producer Price Index – monthly

These data are showing changes in the prices of finished goods and services sold by manufacturers. This is a leading indicator of consumer inflation – when producers charge more for their goods and services, higher costs are usually passed on to consumers. This data will be published on Wednesday 13/12/2023 at 14:30 CET and is expected to increase by 0.2% compared to the previous results.

Retail sales in the US – monthly

Retail sales reflect the change in U.S. retail wages in the month under review compared to the previous month. The calculation is adjusted for inflation. The index is often called an indicator of consumer spending and allows for an assessment of inflation in the country. The growth of the indicator can have a positive effect on the dollar quotes. The information will be published on Thursday 14/12/2023 at 14:30 CET and is expected to decrease by 0.1% compared to last month.

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