It was a poor day for the US dollar on Friday, as it weakened late into the afternoon. This was mainly due to investors selling off their US dollar positions before the weekend, as it climbed comfortably to the 1.5500 level against sterling. Data released Friday should have had more of a positive impact on the US dollar, as producer-related inflation rose above expectations, and the consumer economic conditions indicator showed positive growth compared to the previous month.
We can expect a busy week with manufacturing and industrial production data on Monday, both expected to show strong signs of growth. The main spotlight though will be on Wednesday’s US Federal Reserve statement for June. The June meeting was often mooted by market commentators as the most likely time when US interest rates could be first increased before the poor US economic performance in the first part of 2015 shifted expectations to later in the year.
Consumer inflation data due on Thursday is also expected to show strong signs, in line with producer inflation released last Friday. Alongside this, we will have weekly unemployment claims and manufacturing index data, which are expected to show strong signs of growth.