US politics might be back on center stage this week as the Nunes Memo has been released. The FBI and the Democrats fought this release (which Trump has instead pushed forward) because it confirms just how much power corrupts: the FBI and Department of Justice abused their surveillance authority to target Trump’s 2016 presidential campaign. This is a criminal act and we can expect a long lasting case in court. The markets have yet to respond. Beyond this new development, the US debt ceiling will need to be addressed on Feb 8.
Central banks will be in focus with the RBA, RBNZ and Bank of England deciding on rates. The RBA will likely remain on hold; the RBNZ is expected to keep rates on hold after surprisingly weak inflation data but may comment about the level of the NZD; the Bank of England will also release their Quarterly Inflation Report and hold a press conference while Governor Carney publishes his open letter to the chancellor explaining why inflation is above the 3.0% target. As for the the Fed, pay close attention to speeches from the NY Fed’s Dudley and SF Fed’s Williams.
Other key releases this week are: UK services PMI and Industrial Production; NZD employment change; Cad employment change; China Caixin services PMI, Trade data, CPI and PPI. Australia Retail Sales, Trade data and Housing Finance.
Going into the week I am bearish on US equities for the first time in months; I remain bearish the Aussie; I’m bearish on Silver; I remain bearish on US bonds.
About the Author
Justin is a Forex trader and Coach. He is co-owner of www.fxrenew.com, a provider of Forex signals from ex-bank and hedge fund traders (get a free trial), or get FREE access to the Advanced Forex Course for Smart Traders. If you like his writing you can subscribe to the newsletter for free.