The U.S. dollar started the week with strong gains, which ended last week following positive employment data, especially wage figures. The dollar index hit its highest level since September 5, trading at 95.56, but trade tensions remain an obstacle to dollar movements in the coming period.
The following are highlights of the major economic events and data this week:
Growth and employment figures in the UK
The British economy grew at its fastest pace in nearly a year in the three months to July driven by strong consumer spending due to the World Cup and unusually warm weather, GDP rose by 0.6% compared to the previous reading of 0.4%.
The UK labor market is doing well with the unemployment rate steady at a 4%, but wages are still not working well. Unemployment is expected to remain unchanged with a slight 2.5% rise in wages.
Also, the markets are looking to the BoE meeting this week after raising interest rates to 0.75% at the August meeting, but there is still some hesitation due to uncertainties about the future of Brexit talks. Monetary policy is widely expected to remain unchanged as well as interest rates.
US inflation figures
Core consumer price inflation rose by 2.4% in July and is expected to rise in August by the same percentage, supporting the continuation of the interest rate hike, and on a monthly basis, expected to rise by 0.2%.
Australian Employment Data
Australian employment data was disappointing in July with a loss of 3.9 thousand jobs. The economy is expected to add about 18.4 thousand jobs in August and unemployment will stabilize at 5.3%.
ECB monetary policy decision
The ECB is seeking to end its quantitative easing program by the end of this year, and the bank is expected to make no changes at Thursday's meeting and interest rates will remain unchanged.
