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Week ahead in Forex Markets (Oct 10 – 14), Main focus on FOMC, BOE Governor Bailey speaks

Most investors will be keeping an eye on the second part of the week as the US prepares to release PPI, CPI, and Core Retail Sales data. This could result in a high level of volatility at the week’s finish, along with the FOMC meeting minutes. The PPI, CPI, and Core Retail Sales predictions point to continued expansion in the US. Investors will be expecting the Federal Reserve to respond strongly to ongoing expansion, so if this does occur, the Fed will need to consider raising rates more aggressively once more. The language the Fed employs in the FOMC meeting minutes before the CPI and retail sales statistics are released will be fascinating to see.

Additionally, UK Bank of England Governor Bailey is scheduled to appear twice this week and is expected to discuss the recent GBP decline. The governor of the central bank could outline the next steps the BoE will take to try to stop the GBP from plunging any lower.

The USD is currently the strongest currency, according to this week’s strength meter, and this is not likely to change. After entering the reversal zone last week, the EURO was the weakest currency. The strength meter shows that the JPY has surged back over the 0 line, indicating that more strength is still to come.