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26.12.2022 12:37 AM
The most important economic events of the week 26.12.2022-01.01.2023

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That's it, the new year 2023 is ahead! We won't be seeing much macro data this week. Trading volumes will be significantly reduced, and from Saturday, December 31 to Sunday, January 1, the world will celebrate the New Year. However, investor activity may resume in the first days of January. Take note that new trends and long-term trends often emerge in the first days of the new year.

Investors ended the week (12/19/2022–12/25/2022) on a negative note: world stock indexes continued to decline. Last year was also disappointing for the bulls. In particular, the US broad market index S&P 500 lost more than 26% in 2022. The US dollar also continued to weaken last week. The DXY index ended the week in the red zone and again fell below the 104.00 mark, after testing the 103.10 mark a week earlier. But 2022 was a success for the dollar as a whole: DXY increased by more than 8%. If the stance of the accompanying statements by the Federal Reserve following their December meeting had been tougher, and as we remember, they decided to slow down the pace of tightening the monetary policy, then perhaps the dollar index could have returned to the area closer to the 20-year high of 114.74 reached in September.

However, economists believe that the dollar has the potential to resume growth next year, given that the Fed still intends to further raise the interest rate, aiming to return inflation to the target level of 2%. However, along with an increase in the interest rate, the risks of a recession of the American economy are also growing, and this is a negative factor for both the US stock market and the dollar. Thus, the intrigue regarding the further dynamics of the dollar and stock indices remains. As always, we will have to rely on both the current fundamental background and technical analysis in our strategy, not forgetting about stops.

There will be no particularly important events or reports in the economic calendar. Nevertheless, market participants are likely to pay attention to the release of macro data on Japan and the US. Do recall that many Forex brokers suspend their work on weekends until Tuesday, December 27, 00:00 terminal time.

Monday, December 26

No important macro data scheduled for release and some countries are celebrating Boxing Day: banks and stock exchanges in Europe and America will be closed. However, market participants who follow the yen will pay attention to the speech of Bank of Japan Governor Haruhiko Kuroda during the Asian trading session and the release of Japanese macro data. Among the data are unemployment and retail sales in November. Projections are on the side of a decline, which will probably have a negative effect on JPY quotes.

Tuesday, December 27

No important data on Tuesday. Traders, who keep an eye on the dollar, are likely to pay attention to the release of the Home Price Index (October). The housing market is an important part of the American economy, and with home prices and inflation being interrelated, this data could lead to increased volatility in the U.S. currency. The data is expected to show some growth, which should be positive for the USD.

Wednesday, December 28

No important macro data on Wednesday.

Thursday, December 29

U.S. Jobless Claims

The U.S. Department of Labor will release its weekly report on the state of the U.S. labor market with data on the number of initial and continued jobless claims. The labor market condition (together with GDP and inflation data) is a key indicator for the Fed in determining its monetary policy parameters.

A result above expectations and a rise in the indicator suggests weakness in the labor market, which negatively affects the U.S. dollar. A fall in the indicator and its low value is a sign of labor market recovery and can have a short-term positive impact on the USD.

Jobless claims are expected to remain at pre-pandemic lows, which is also a positive sign for the USD, indicating a stabilization of the US labor market.

Previous (weekly) values for initial jobless claims data: 216k, 214k, 231k, 226k, 241k, 223k, 226k, 217k, 214k, 226k, 219k, 190k, 209k, 208k, 218k, 228k, 237k, 245k.

Previous (weekly) values for continued claims data: 1672k, 1678k, 1670k, 1609k, 1551k, 1503k, 1494k, 1438k, 1383k, 1364k, 1365k, 1346k, 1376k, 1401k, 1401k, 1437k, 1412k.

The level of influence on the markets - from medium to high.

Friday, December 30

This is the last trading day of 2022. No important macro data scheduled to be released. Investor activity will be minimal. The world is getting ready to face 2023.

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