EUR/USD ended Friday’s session at 1.3805, 0.02% higher for the day, after rising as high as 1.3833, the highest since November 2011 earlier. For the week, the pair gained 0.97%.
The euro eased back from session highs against the dollar after a report showed that the German Ifo business confidence index unexpectedly fell for the first time in six months in October.
The report came one day after data on euro zone manufacturing and service sector activity indicated that the recovery in the region remains sluggish.
The dollar remained under pressure after data on Friday showed a third consecutive monthly drop in core durable goods orders in September and another report showed that U.S. consumer sentiment was revised lower in October.
The data cemented expectations that the Federal Reserve will maintain the current pace of its asset purchase program well into next year.
Data released earlier in the week showing that U.S. jobs growth had slowed in September, even before the start of the 16-day government shutdown, prompted investors to re-evaluate expectations over the timing of a possible reduction to the Fed’s stimulus program.
The dollar eased off two week lows against the yen on Friday, withUSD/JPY edging up 0.12% to settle at 97.39, after falling to lows of 96.95 earlier. The pair ended the week down 0.82%.
Elsewhere, the pound ended Friday’s session slightly lower against the dollar, despite data showing that the U.K. economy grew at the fastest pace in three years in the third quarter.
The Office of National Statistics said the U.K. economy expanded by 0.8% in the three months to September and grew 1.5% on a year-over-year basis.
GBP/USD ended Friday’s session at 1.6168, down 0.21% for the day after briefly touching session high of 1.6147. For the week, the pair gained 0.22%.
The Canadian dollar fell to one-and-a-half month lows against the greenback on Friday after the Bank of Canada indicated that interest rates may remain on hold for longer than had been expected.
The Canadian dollar weakened after the BoC dropped language referring to the need for future rate increases from its monetary policy statement on Wednesday and revised down its growth forecast for this year.
USD/CAD settled at 1.0452, the highest since September 6 and ended the week with gains of 1.39%.
In the week ahead, investors will be focused on the outcome of Wednesday’s Federal Reserve policy setting meeting. The central bank is expected to keep its USD85 billion-a-month asset purchase program on track.
Monetary policy decisions by the Bank of Japan and the Reserve Bank of New Zealand will also be closely watched.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, October 28
The U.K. is to release private sector data on retail sales, an important economic indicator.
The U.S. is to produce reports on industrial production and the capacity utilization rate, as well as private sector data on pending home sales.
Tuesday, October 29
Japan is to release data on household spending and retail sales.
The euro zone is to release the results of the Gfk index of consumer climate, an important economic indicator.
The U.K. is to publish data on net lending to individuals.
Canada is to release a report on raw material price inflation, a leading indicator of consumer inflation.
The U.S. is to produce data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity. The U.S. is also to publish data on producer price inflation and a report on consumer confidence, a leading economic indicator.
Wednesday, October 30
Japan is to publish preliminary data on industrial production.
Germany is to release official data on the change in the number of people unemployed, a leading economic indicator, as well as preliminary data on consumer inflation.
Elsewhere in the euro zone, Spain is to publish a preliminary estimate of third quarter gross domestic product, the broadest indicator of economic activity and the leading indicator of economic growth.
Switzerland is to release its KOF economic barometer, a leading indicator of economic health.
The U.S. is to release the ADP report on nonfarm payrolls and official data on consumer price inflation.
Later Wednesday, the Federal Reserve is to announce its federal funds rate and publish its rate statement. The statement is to be followed by a closely watched press conference with Chairman Ben Bernanke.
The RBNZ is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
Thursday, October 31
New Zealand is to publish data on building consents, a leading indicator of future construction activity, as well as a private sector report on business confidence.
Australia is to release a series of data, including reports on building approvals, import prices and private sector credit.
The BoJ is to announce its benchmark interest rate. The announcement is to be accompanied by the bank’s monetary policy statement, which contains important insights into the economic outlook. The BoJ is to hold a press conference after the rate announcement. Japan is also to release data on average cash earnings.
The euro zone is to produce preliminary data on consumer inflation and a separate report on the unemployment rate, a leading indicator of economic health.
Canada is to publish its monthly report in GDP, the broadest indicator of economic activity.
The U.S. is to release data on initial jobless claims and a report on manufacturing activity in the Chicago region.
Friday, November 1
Australia is to publish data on producer price inflation, a leading indicator of consumer prices.
China is to produce official data on manufacturing activity, a leading indicator of economic health. Beijing is also to release the revised reading of the HSBC manufacturing index.
Switzerland is to release its SVME index, an important economic indicator.
The U.K. is to publish data on manufacturing activity, a leading economic indicator.
The U.S. is to round up the week with a report from the Institute of Supply Management on manufacturing activity.
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