Fundamental factors continue to exert negative pressure on the US dollar. From a technical perspective, the USDX index remains above the key support levels of 97.50 and 96.80 despite a prolonged correction that has placed it in a medium- and long-term bear market. Increased market volatility persists, with strong demand for safe-haven assets such as the yen, the franc, and gold.
The upcoming week of 12.05.2025 – 18.05.2025 is also expected to be highly volatile due to the release of US inflation data, which may determine the direction of the US dollar for the rest of the month.
Besides, market participants will focus on the publication of crucial macroeconomic data from the UK, Germany, the US, New Zealand, the Eurozone, Japan, and Australia.
Note: During the coming week, new events may be added to the calendar, and/or some scheduled events may be canceled. GMT time
The article covers the following subjects:
Major Takeaways
- Monday: no important macroeconomic statistics are scheduled.
- Tuesday: UK labor market data, US CPIs.
- Wednesday: German CPIs.
- Thursday: Australian labor market data, UK GDP, Eurozone GDP, US PPIs and retail sales data, and Japanese GDP.
- Friday: RBNZ’s inflation expectations, preliminary US Consumer Sentiment Index.
- Key event of the week: US CPI release.
Monday, May 12
There are no important macroeconomic statistics scheduled to be released.
Tuesday, May 13
06:00 – GBP: Average Weekly Earnings Over the Last Three Months. Unemployment Rate
The UK Office for National Statistics monthly publishes a report on average weekly earnings covering the period for the last three months, including and excluding bonuses.
This report is a key short-term indicator of employee average earnings changes in the UK. An increase in wages is positive for the British pound, whereas a low indicator value is unfavorable. Forecast: The May report suggests that average earnings, including bonuses, rose again in the last three months, including January, February, and March after gaining +5.6%, +5.9%, +6.0%, +5.6%, +5.2%, +4.3%, +3.8%, +4.0%, 4.5%, +5.7%, +5.9%, +5.7%, +5.6%, +5.6%, +5.8%, +6.5%, +7.2%, +7.9%, +8.1%, +8.5%, +8.2%, +6.9%, +6.5%, +5.8%, +5.9%, +6.0%, +6.5%, +6.%, +6.1%, +5.5%, +5.2%, +6.4%, +6.8%, +7.0%, +5.6%, +5.7%, +4.8%, +4.3%, +4.2% in previous periods. The earnings value excluding bonuses also increased with percentages at +5.9%, +5.8%, +5.9%, +5.6%, +5.2%, +4.8%, +4.9%, +5.1%, +5.4%, +6.0%, +6.0%, +6.0%, +6.1%, +6.2%, +6.6%, +7.3%, +7.7%, +7.8%, +7.8%, +7.8%, +7.8%, +7.3%, +7.2%, +6.7%, +6.6%, +6.6%, +6.7%, +6.5%, +6.1%, +5.8%, +5.5%, +5.2%, +4.7%, +4.4%, +4.2%, +4.2%, +4.1%, +3.8%, +3.7%, +3.8% in previous periods. These figures show continued growth in employee earnings levels, which is positive for the British pound. If the data outperforms the forecast and/or previous values, the pound will likely strengthen in the currency exchange market. Conversely, if the data falls short of the forecast/previous values, the pound will be negatively affected.
The UK unemployment data will be released at the same time. Unemployment is expected to stand at 4.4% for the three months of January, February, and March (against 4.4%, 4.4%, 4.4%, 4.3%, 4.3%, 4.0%, 4.1%, 4.2%, 4.4%, 4.4%, 4.3%, 4.2%, 4.0%, 3.8%, 3.9%, 4.0%, 4.1%, 4.2%, 4.3%, 4.2%, 4.0%, 3.9% in previous periods).
Since 2012, the UK unemployment rate has fallen steadily from 8.0% in September 2012. The unemployment decline is a positive factor for the pound, while its growth negatively impacts the currency.
If the UK labor market data appears to be worse than the forecast and/or the previous value, the pound will be under pressure.
Regardless, when the UK labor market data is released, the pound and the London Stock Exchange are expected to experience increased volatility.
12:30 – USD: Consumer Price Indexes
The Consumer Price Index (CPI) measures the change in prices of a selected basket of goods and services over a given period. It is a key indicator for assessing inflation trends and changes in consumer preferences. Food and energy are excluded from the Core CPI to provide a more accurate assessment.
A high index reading typically strengthens the US dollar by signaling an increased likelihood of the Fed interest rate hike, while a low reading generally weakens the currency.
Previous values YoY:
- CPI: +2.4%, +2.8%, +3.0% in January 2025, +2.9%, +2.7%, +2.6%, +2.4%, +2,5%, +2.9%, +3.0%, +3.3%, +3.4%, +3.5%, +3.2%, +3.1%, +3.4%, +3.1% +3.2%, +3.7%, +3.7%, +3.2%, +3.0%, +4.0%, +4.9%, +5.0%, +6.0%, +6.4% in January 2023;
- Core CPI: +2.8%, +3.1%, +3.3% in January 2025, +3.2%, +3.3%, +3.3%, +3.3%, +3.2%, +3.2%, +3.3%, +3.4%, +3.6%, +3.8%, +3.8%, +3.9%, +3.9%, +4.0%, +4.0%, +4.1%, +4.3%, +4.7%, +4.8%, +5.3%, +5.5%, +5.6%, +5.5%, +5.6% in January 2023.
The data shows that inflation is in no hurry to decline. Although it is well below the 2022 level, when annual inflation in the US reached a 40-year high of 9.1% in June, the rate of decline is slower than the Fed expected. US inflation remains well above the Fed’s 2% target, forcing the central bank to keep interest rates high. In case of a possible reduction, the Fed will likely pause to assess the economic and labor market situation.
If the figures are confirmed or prove to be lower than expected, the US dollar will likely decline in value in the short term. Readings higher than estimated will strengthen the currency, increasing the probability of the Fed keeping the interest rate high for longer.
Wednesday, May 14
06:00 – EUR: German Harmonized Index of Consumer Prices (Final Estimate)
The Harmonized Index of Consumer Prices (HICP) is published by the European Statistics and is calculated using a methodology agreed upon by all EU countries. The HICP is an indicator for measuring inflation and is used by the European Central Bank to assess price stability. A positive index result strengthens the euro, while a negative one weakens it.
Previous values YoY: +2.3%, +2.6%, +2.8% in January 2025, +2.6%, +2.8% in December 2024, +2.4%, +2.4%, +1.8%, +2.0%, +2.6%, +2.5%, +2.8%, +2.4%, +2.3%, +2.7%, +3.1% in January 2024, +3.8% in December, +2.3% in November, +3.0% in October, +4.3% in September, +6.4% in August, +6.5% in July, +6.8% in June, +6.3% in May, +7.6% in April, +7.8% in March, +9.3% in February, +9,2% in January, +9.6% in December, +11.3% in November, +11.6% in October, +10.9% in September, +8.8% in August, +8.5% in July, +8.2% in June, +8.7% in May, +7.8% in April, +7.6% in March, +5.5% in February, +5.1% in January 2022.
The data points to an uneven pace of inflation slowdown in Germany, which in turn forces the ECB to either tighten its monetary policy or pause rate cuts. Figures lower than the previous reading will likely affect the euro negatively. Conversely, the resumption of inflation growth may provoke the appreciation of the euro. The growth of the indicator values is a positive factor for the currency.
If the April data turns out to be better than previous values, the euro may strengthen in the short term.
The preliminary estimate stood at +2.2%.
Thursday, May 15
01:30 – AUD: Employment Rate. Unemployment Rate
The employment rate reflects the monthly change in the number of employed Australian citizens. The increase in the indicator value positively impacts consumer spending, stimulating economic growth. A high reading is positive for the Australian dollar, while a low reading is negative. Previous indicator values: +32,200 in March, -52,800 in February, +44,000 in January 2025, +56,300 in December 2024, +35,600 in November, +15,900 in October, +64,100 in September, +42,600 in August, +48,900 in July, +52,300 in June, +39,500 in May, +37,400 in April, -6,100 in March, +120,400 in February, +11,900 in January 2024, -58,900 in December 2023, +55,500 in October, +13,400 in September, +62,300 in August, 0 in July, +19,800 in June, +83,800 in May, -14,700 in April, +93,800 in March, +45,100 in February, 23,100 in January 2023.
Besides, the Australian Bureau of Statistics will publish a report on the unemployment rate. It is an indicator that estimates the ratio of the share of the unemployed population to the total number of working-age citizens. The rise in the indicator readings demonstrates the weakening of the labor market, negatively impacting the national economy. A decrease in the indicator is positive for the Australian dollar.
Forecast: Australian unemployment has remained at its lowest levels and stood at 4.1% (against 4.1% in March, February, and January 2025, 4.0% in December 2024, 3.9% in November, 4.1% in October, September, and August, 4.2% in July, 4.1% in June, 4.0% in May, 3.8% in April, 3.7% in March and February, 4.1% in January, 3.9% in December and November, 3.8% in October, 3.6% in September, 3.7% in August and July, 3.5% in June, 3.6% in May, 3.7% in April, 3.5% in March and February, 3.7% in January, 3.5% in December, 3.4% in November and October, 3.5% in September and August, 3.4% in July, 3.5% in June, 3.9% in May and April, 4.0% in March and February, 4.2% in January), while the employment rate has increased.
The Reserve Bank of Australia has repeatedly stated that the Australian economy and the central bank’s plans are influenced by key indicators like the level of household debt and spending, wage growth, and the state of the labor market, in addition to the international trade situation. If the indicator readings are lower than expected, the Australian dollar may decline significantly in the short term, while higher data will strengthen the currency.
06:00 – GBP: UK GDP for Q1 2025 (Preliminary Estimate)
GDP is viewed as an indicator of the UK economy’s condition. The growing GDP indicator is considered positive for the British pound. The UK GDP rate was one of the highest in the world until 2016, when the Brexit referendum occurred. Subsequently, its growth decelerated, and with the onset of the COVID-19 pandemic, the UK GDP rate dropped.
Previous GDP values: +1,5% in Q4 2024, 0.0% in Q3, +0.5% in Q2, +0.7% in Q1 2024, -0.3% in Q4, -0.1% in Q3, 0% in Q2, +0.2% in Q1 2023, +0.1% in Q4 2022, -0.1% in Q3, +0.1% in Q2, +0.5% in Q1 2022, +1.5% in Q4 2022.
The key factors that may force the Bank of England to keep the rate low include weak GDP, slow labor market growth, and low consumer spending. Should the GDP data fall significantly below previous values, the pound will face downward pressure. Conversely, high GDP readings will bolster the currency.
09:00 – EUR: Eurozone GDP for Q1 (Second Estimate)
GDP is considered to be an indicator of the overall economic health. A rising trend of the GDP indicator is positive for the euro, while a low reading weakens the currency.
Recent Eurozone macro data has shown a gradual recovery in the growth rate of the European economy after a sharp decline in early 2020.
Previous values: +0.2% (+1.2% YoY) in Q4 2024, +0.4% (+0.9% YoY) in Q3, +0.2% (+0.6% YoY) in Q2, +0.3% (+0.4% YoY) in Q1 2024, 0% (+0.1% YoY) in Q4 2023, -0.1% (0% YoY) in Q3, +0.1% (+0.5% YoY) in Q2, -0.1% (+1.0% YoY) in Q1 2023, 0% (+1.9% YoY) in Q4 2022, +0.7% (+4,0% YoY) in Q3, +0.8% (+4.1% YoY) in Q4 2022, +0.7% (+4,6% YoY) in Q3, +2.2% (+3.9% YoY) in Q3, +2.2% (+14.3% YoY) in Q2, and -0.3% (-1.3% YoY) in Q1 2021.
If the data is below the forecasted and/or previous values, the euro may decline. Conversely, readings exceeding the predicted values may strengthen the euro in the short term. However, the European economy is still far from fully recovering even to pre-crisis levels.
The preliminary estimate stood at +0.4% (+1.2% YoY) in Q1 2025.
12:30 – USD: Producer Price Index (PPI). Retail Sales. Retail Sales Control Group
The Producer Price Index (PPI) measures the average change in wholesale prices determined by manufacturers at all stages of production. The index is one of the leading inflation indicators in the United States, estimating the average change in wholesale producer prices.
Rising production costs increase wholesale selling prices, which ultimately boosts inflation. In normal economic conditions, growing inflation usually puts upward pressure on the national currency quotes, implying a tighter central bank monetary policy.
Previous values: -0.4% (+2.7% YoY), 0% (+3.2%YoY), +0,4% (+3,5% YoY) in January 2025,+0.2% (+3.3% YoY) in December, +0.4% (+3.0% YoY) in November, +0.2% (+2.4% YoY) in October, 0% (+1.8% YoY) in September, +0.2% (+1.7% YoY) in August, +0.1% (+2.2% YoY) in July, +0.2% (+2.6% YoY) in June, -0.2% (+2.2% YoY) in May, +0.5% (+2.2% YoY) in April, +0.2% (+1,6% YoY) in March, +0.6% (+1.6% YoY) in February, +0.3% (+0.9% YoY) in January 2024, 0% (+0.9% YoY) in December 2023, -0.5% (+1.3% YoY), +0.5% (+2.2% YoY), +0.7% (+1.6% YoY), +0.3% (+0.8% YoY), +0.1% (+0.2% YoY), -0.3% (+0,9% YoY), +0.2% (+2.3% YoY), -0.5% (+2.7% YoY), -0.1% (+4.9% YoY), +0.7% (+5.7% YoY) in January 2023.
If the data exceeds the forecasted value, the US dollar will likely strengthen. Conversely, if the data falls below forecasted and previous values, this will exert pressure on the Fed. This could lead to the Fed’s monetary policy easing, which will negatively impact the US dollar.
Retail sales. This Census Bureau report on retail sales reflects the total sales of US retailers of all sizes and types. The change in retail sales is a key indicator of consumer spending. The report is a leading indicator, and the data may be subject to significant revisions in the future. High indicator readings strengthen the US dollar, while low readings weaken it. A relative decline in the indicator may have a short-term negative impact on the US dollar, while a rise in the indicator will positively impact the currency.
In March 2025, the value of the indicator stood at +1.5% (after +0.2% in February, -0.9% in January, +0.4% in December, +0.7% in November, +0.4% in October and September, +0.1% in August, +1.1% in July, -0.2% in June, +0.2% in May, -0.2% in April, +0.5% in March, +0.7% in February, -1.1% in January 2024).
Retail sales are the main indicator of consumer spending in the United States, showing the change in the retail industry.
Retail sales serve as an indicator of domestic consumption, contributing the most to the US GDP and being one of the main factors influencing inflation. Deterioration of the indicator values is a negative factor for the US dollar. Inflation deceleration may prompt the Fed to begin the process of monetary policy easing.
The Retail Control Group indicator gauges volume in the retail industry and is used to calculate price indexes for most goods. High readings strengthen the US dollar, while low readings weaken the currency. A slight increase in the figures is unlikely to boost the dollar. If the data is lower than the previous readings, the dollar may be negatively impacted in the short term. Previous values: +0.4%, +1.0%, -0,8%, +0.7%, +0.4%, -0.1%, +0.7%, +0.3%, +0.4%, +0.9%, +0.4%, -0.3%, +0.9%, 0%, -0.4% in January 2024, +0.6%, +0.2%, +0.2%, +0.2%, +0.2%, +0.7%, +0.3%, +0.4%, +1.0%, -1.2%, -0.1%, +2.6% in January 2023.
23:50 – JPY: Japan GDP for Q1 2025 (Preliminary Estimate)
GDP is a measure of a country’s overall economic condition, which assesses the rate of growth or decline of a country’s economy. The Gross Domestic Product report, published by the Cabinet Office of Japan, represents the total value of all final goods and services produced by Japan over a certain period in monetary terms. A rising trend in GDP is seen as positive for the yen, while a low reading is seen as negative.
In Q4 the country’s GDP stood at +0.6% (+2.2% YoY), after +0.3% (+1.2% YoY) in Q3, +0.7% (2.9% YoY) in Q2, -0.5% (-1.8% YoY) in Q1 2024, 0.1% (+0.4% YoY) in Q4 2023, -0.8% (-3.2% YoY) in Q3, +1.0% (+4.2% YoY) in Q2, +1.0% (+4.0% YoY) in Q1 2023.
The data suggests a bumpy recovery for the Japanese economy after it collapsed due to the coronavirus pandemic in 2020.
The forecast implies that Japan’s GDP rose in Q4 2024, which is positive for the yen. Readings that exceed expectations will undoubtedly bolster the yen and Japanese stock indices. Conversely, underperformance will exert pressure on them.
Friday, May 16
03:00 – NZD: Inflation Expectations of the Reserve Bank of New Zealand for Q2
The indicator measures consumers’ expectations regarding annual inflation over the next 24 months. An increase in these expectations can significantly influence the likelihood of an interest rate hike. A high indicator value is a positive factor for the New Zealand dollar.
Previous values QoQ: +2.06% in Q1 2025, +2.12% in Q4 2024, +2.03%, +2.33%, +2.50% in Q1 2024, +2.76%, +2.83%, +2.79%, +3.3%, +3.62% in Q4 2022.
14:00 – USD: University of Michigan Consumer Sentiment Index (Preliminary Release)
This indicator reflects American consumers’ confidence in the country’s economic development. A high reading indicates economic growth, while a low one points to stagnation. Previous indicator values: 52.2 in April, 57.0 in March, 64.7 in Fabruary, 71.1 in January, 74.0 in December, 71.8 in November, 70.5 in October, 70.1 in September, 67.9 in August, 66.4 in July, 68.2 in June, 69.1 in May, 77.2 in April, 79.4 in March, 76.9 in February, 79.0 in January 2024, 69.7 in December 2023, 61.3 in November, 63.8 in October, 68.1 in September, 69.5 in August, 71.6 in July, 64.4 in June, 59.2 in May, 63,5 in April, 62.0 in March, 67.0 in February, 64.9 in January 2023, 59.7 in December, 56.8 in November, 59.9 in October, 58.6 in September, 58.2 in August, 51.5 in July, 50.0 in June, 58.4 in May, 65.2 in April, 59.4 in March, 62.8 in February, 67.2 in January 2022. An increase in the indicator will strengthen the US dollar, while a decrease will weaken the currency. The data shows that the recovery of this indicator is uneven, which is unfavorable for the greenback. A decline below previous values will likely negatively impact the US dollar in the near term.
Price chart of EURUSD in real time mode
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteFinance broker. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2014/65/EU.
According to copyright law, this article is considered intellectual property, which includes a prohibition on copying and distributing it without consent.
Feed from Litefinance.com