The Euro and the Swiss Franc have both been having some trouble holding above their 6-month lows, which has been more the result of the US dollar’s consolidation than anything else.
Event risk for the currencies will pick up a bit on Thursday, though none of the scheduled releases are truly key indicators. In the Euro-zone, the purchasing managers index (PMI) for the services and manufacturing sectors are both anticipated to hold below 50 – signaling a contraction in business activity – for the third consecutive month in August. Meanwhile, the Swiss franc will see the release of the trade balance and the producer and import price index. Given the broad slowing of the Euro-zone’s economies, exports are likely to lag and weigh on the overall trade balance down to 2.0 billion francs for the month of July. The producer and import price index, on the other hand, is forecasted to rise 0.3 percent in July while the annualized rate is anticipated to hit a record high of 4.6 percent. While these figures could spark a bit of price action for the Euro and Swiss franc on Thursday, significant moves will likely hold off until Friday when Federal Reserve Chairman Bernanke speaks.
Check out Daily Fundamentals for our full forex trading wrap-up and outlook for Thursday.
