The USD Collapse Persists (Weekly Review)

2020-07-28
The USD seems to be completely out of luck, as it continued to fall last week against many of its competitors, in particular the EUR, GBP, CHF, and JPY. Also, along with liquidity injections by global central banks, gold continues to enjoy stable demand, having broken through multi-year highs in today's Asian session.

Fears of the detrimental impact of the coronavirus on the global economy and the US economy are also forcing investors to invest in “safe haven” assets, i.e. gold, the CHF, and the JPY. Technical indicators signal a strong overbought precious metal, which increases the risk of a corrective decline below $ 1900 per ounce, but attempts by bulls to break through to the 2000 level are quite possible.

The prospects for the above currencies paired with the USD have improved significantly, while the negative consequences of the coronavirus also on the economy of the Eurozone and the UK should not be underestimated. The European leaders' agreement on the bailout fund helped the EUR break through to current highs, and the GBP benefits from the USD fall, but the growth of these currencies looks somewhat hypertrophied due to existing and potential problems, so bulls should be extremely careful.

Schedule for this week:

Monday, July 27
12:30 GMT - USA. Durable Goods Orders.

Tuesday, July 28
22:45 GMT – New Zealand. Number of Vacancies;
13:00 GMT - USA. S&P/CaseShiller House Price Index;
14:00 GMT - USA. Consumer Confidence.

Wednesday, July 29
01:30 GMT - Australia. RBA Trimmed Mean Consumer Price Index (CPI);
01:30 GMT - Australia. Consumer Price Index (CPI);
18:00 GMT - USA. Fed Interest Rate Decision;
18:00 GMT - USA. FOMC Monetary Policy Report;
18:30 GMT - USA. FOMC Press Conference.

Thursday, July 30
22:45 GMT – New Zealand. Building Consents;
23:50 GMT - Japan. Retail Sales;
01:30 GMT - Australia. Private House Approvals;
07:55 GMT - Germany. Unemployment Rate;
08:00 GMT - Germany. GDP;
09:00 GMT - Eurozone. Consumer Confidence;
12:00 GMT - Germany. Harmonised Index of Consumer Prices (HICP);
12:30 GMT - USA. GDP Annual.

Friday, July 31
01:00 GMT - PRC. NBS Manufacturing Purchasing Managers Index (PMI);
06:00 GMT - Germany. Retail Sales;
09:00 GMT - Eurozone. Consumer Price Index (CPI);
09:00 GMT - Eurozone. GDP;
12:30 GMT - Canada. GDP;
12:30 GMT - USA. Personal Spending;
12:30 GMT – USA. Real Personal Consumption;
13:45 GMT - USA. Chicago PMI. 

Author: Anthony Porter, IAFT Analyst

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