US DOLLAR CURRENCY VOLATILITY SET TO RISE WITH ECONOMIC DATA & FED SPEAKERS ON DOCK NEXT WEEK:
- The US Dollar[1] faces serious event risk next week with Fed speakers and high-impact economic data releases on deck, which will serve as sources of volatility
- USD[2] price action turns to US-China trade talks in addition to consumer confidence reports, PMI data and core PCE inflation figures as catalysts that spark the currency’s next direction
- IG Client Sentiment reveals insight on the bullish and bearish biases of retail forex traders
We noted in our last US Dollar price volatility report that the greenback has lacked conviction over its next direction even despite a monetary policy update from the Federal Reserve. At the same time, US Dollar implied volatility readings have ebbed now that the immediate risk surrounding the September FOMC rate decision is in the rearview mirror. Looking ahead, however, a barrage of economic data releases in addition to speeches from Fed officials next week stand to spark USD price action. [3][4]
US DOLLAR IMPLIED VOLATILITY & TRADING RANGES (1-WEEK)
The DailyFX Economic Calendar details several US economic indicators on deck, which forex traders will weigh against the fundamental backdrop for the US Dollar as it relates to future Fed policy decisions. The FOMC[6] decided to cut its benchmark interest rate for the second time this year citing “implications of global developments for the economic outlook as well as muted inflation pressures.” [5]
The central bank also stated that it will closely monitor “measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.” As such, US manufacturing and services PMI data as well as
