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WEEK AHEAD: AUGUST 22

Short Description

Jackson Hole

Video Script

Number one:
Jackson Hole Economic Symposium

The Federal Reserve Bank of Kansas City sponsors the Jackson Hole Economic Symposium every year. The symposium focuses on significant economic problems that affect economies around the world. Prominent central bankers, finance ministers, academic giants, and top financial industry professionals from throughout the world are among the participants. This year's event is particularly significant since market players will be looking for any cues regarding upcoming monetary policy decisions from major central banks.

Number two:
US GDP for the second quarter

This week, the second quarter GDP for the United States is scheduled to be released. Investors want to see how much the Federal Reserve's aggressive policy tightening has affected the economy, with market forecasts for a quarterly contraction of 0.9%. This reading should also indicate whether more interest rate hikes are approaching and whether the Federal Reserve would slow down its tightening to prevent a recession.

Number three:
US Housing data

After a streak of rate increases in the US, the housing sector was one of the first to predict an upcoming recession. This week will see the announcement of both new and pending house sales. The Wells Fargo Housing Sector Index temporarily fell below 50 points last week, indicating a recession. The US dollar would decline if sales dropped much further than anticipated.

Number four:
US earnings session continues
  
The US stock market is still looking for significant earnings reports to be released next week. Additionally, long-term investors continue to base their investment decisions on earnings and quarterly results even though the overall sentiment in the stock market currently appears favourable. Top releases for next week will include Medtronic, NVIDIA and Marvell.

Number five:
EURUSD heading to test levels of parity

After rejecting resistance levels around 1.0350, the euro appears to have ended its upward retracement last week versus the US dollar. Furthermore, the euro may be set for a retest of parity at 1.0000 as support, possibly even this week. A breach below this support should result in additional losses for the EURUSD, therefore traders will be closely monitoring this as it develops.

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