If you’ve blinked at any point over the last 3 months, you’ve probably missed Q1. Whilst we grapple with that in the background, let’s look ahead to Q2 and assess what you should be looking out for over the next 3 months. Let’s go!
USD to continue bounce-back?
The dollar has been making big moves of late and this could very well continue into Q2 as the US economy makes its comeback from the pandemic.
What’s fuelling the dollar drive? Well, there’s a sort of double-positive effect going on in the US right now. Firstly, the vaccine roll-out has far exceeded expectations, with ca. 30% of the population now having received theirs. President Biden lauded that achievement last week and even pledged that the US would manage 200m vaccines in his first 100 days as president, doubling his initial promise.
Secondly, that rather hefty $1.9tn aid package is looming large on everyone’s minds. Where it was first seen as a major negative, pushing the US deficit up even further, it’s now being hailed as a magic wand, crucially pushing up spending as the country begins to open up.
This has all led to a rather positive outlook for the near future, as life slowly begins to return to some degree of normal. This success saw the FED following suit last week, upgrading its annual US growth forecast.
Q2 is a big quarter for the USD. Definitely keep an eye on it!
EUR struggles to linger longer
Europe is the exact flip-side of the US right now. Converse to our chums across the pond, a double-negative effect is happening on the subcontinent.
Whether you’re for or against the vaccine, most agree that nothing has gone smoothly. And reported fears of a third wave of covid are now prompting some European governments to head into lockdowns (that’s if they even left them in the first place). It looks like the EUR is going to have a rough ride throughout Q2. Let’s see if that third-wave comes and where it goes.
GBP gearing up for summer
The pound is having a super 2021, so far. Of the major currencies, GBP has been the strongest performer against the USD by far. February marked the 5th straight month of gains against the dollar as it rose by as much as 3.1 per cent.
Why? Well, basically the same reason that USD is flying right now, GBP is just flying higher. We definitely recommend keeping tabs on the GBP/USD recovery tug-o-war!
What’s going on this week?
There’s a fair bit going on this week, here’s when and where you need to tune in.
Monday 29th March
● No major events are planned.
Tuesday 30th March
● USD — CB Consumer Confidence (MAR)
Wednesday 31st March
● CNY — NBS Manufacturing PMI (MAR)
● GBP — GDP Growth Rate YoY Final (Q4)
● EUR — Core Inflation Rate YoY Flash (MAR)
Thursday 1st April
● USD — Markit Manufacturing PMI Final (MAR) + ISM Manufacturing PMI (MAR)
Friday 2nd April
● USD — Non-Farm Payrolls (MAR) + Unemployment Rate (MAR)
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The Contentworks team