Friday will be a relatively quiet day in terms of economic data. During the Asian session, Japan will release the national Consumer Price Index, which is expected to show a slowdown from 3.3% to 2.5%. Later, the UK will report its retail sales.
Here’s what to know on Friday, August 18:
During the American session, the dollar strengthened overall amid risk aversion and rising Treasury yields. The Dow Jones index fell 0.85%, marking its third straight day of losses and posting its lowest close in a month. Concerns about the outlook for the Chinese economy, coupled with expectations of rising interest rates over a longer period, contributed to market concerns.
US Treasury yields ended the session mixed. The 10-year yield peaked at 4.32%, the highest level since 2007, before easing back, while the 30-year yield rose to 4.42%, the highest level since 2011. The Dollar Index ended the day sideways at 103.40 after reaching two-month highs at 103.59.
Initial claims for US jobless benefits fell to 239,000 in the week ending August 12, exceeding expectations. However, claims for continued unemployment benefits rose to 1.716 million in the week ending August 5, reaching the highest level in four weeks. The Philadelphia Fed manufacturing survey gave a major positive surprise going from -13.5 to 12 points.
No first-rate publications are expected in the United States for Friday. The focus is on the Jackson Hole Symposium, which will take place in a week.
The EUR/USD pair It initially rose to 1.0920, but pulled back during the American session and fell to 1.0855, marking a new 6-week low. In the Eurozone, the final reading of the Consumer Price Index for July will be published, which is expected to hold no surprises. The annual rate stands at 5.5% in July. Eurostat will also publish construction production data for June.
The Japanese Yen managed to regain ground despite rising government bond yields. Falling equity markets supported the yen, along with some loss of momentum in the US dollar. The USD/JPY pair experienced its worst daily decline in two weeks and fell below 146.00. On Friday the national Consumer Price Index will be published in Japan, which is expected to show an increase of 2.5% compared to a year ago, lower than the 3.3% observed in June.
GBP/USD rallied significantly on Thursday. However, the pair failed to hold above the 20-day SMA and fell below 1.2750. The UK round of economic data will conclude on Friday with the release of retail sales. Sales are expected to have decreased 0.5% in July, after a 0.7% increase in June. At the moment, the British Pound is the best performing currency of the week among the major currencies.
USD/CHF remains in an uptrend, although upside momentum remains limited as the pair has been unable to consolidate above 0.8800. In Switzerland, the second quarter pIndustrial will be reported.
The Australian jobs report had a negative impact on the AUD, causing it to underperform on Thursday. However, losses were trimmed throughout the day. The AUD/USD pair bottomed at 0.6365, the lowest level since November, before bouncing towards 0.6450. However, it later pulled back on US dollar strength, extending its losing streak to eight days.
USD/CAD rose for the fourth day in a row and posted its highest daily close since late May near 1.3550. The pair is showing overbought conditions, and a correction is imminent. However, negative sentiment and a stronger US dollar currently favor the upside. In Canada, the prices of industrial products and the price index of raw materials for July will be published.
The NZD/USD pair fell again but closed slightly off the lows. It reached a low of 0.5903 and closed at 0.5925.
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Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
