The economic stars have aligned this week to bring together a series of major, potentially destabilising events for the dollar. And when the dollar feels shocks, they can reverberate around the world.
Yesterday brought the news that US job openings had contracted by more than 250,000, and further employment data on Friday looks set to confirm this slowdown.
That alone could shake the dollar. However, there is quite a bit more to come…
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Later today, GDP forecasts for the next few months will show the impact of US President Donald Trump’s tariff policies. Surprises in either direction will have a major impact on the markets.
The US Federal Reserve will also announce its latest interest rate decision this afternoon. While this is predicted to stay flat. With growing tension between Trump and Fed Chair Jerome Powell – and with the President looking to distract from the Jeffrey Epstein scandal – there is potential for a public spat.
Finally, Trump’s trade tariff pause is set to expire on August 1. With major economies, such as China, still yet to sign a trade deal with the US, there is a large opportunity for economic upset.
While this news is all US-focused, it could have a major impact on the pound and euro. The last time Trump suggested he would unseat Powell, for instance, markets around the world went into freefall.
There’s every chance this week will bring significant upsets to the market.
