Forex - GBP/USD weekly outlook: June 24 - 28

The pound ended the week lower against the broadly stronger dollar on Friday as mounting expectations that the Federal Reserve will soon unwind its bond-buying program underpinned dollar demand.

GBP/USD hit 1.5367 on Friday; the pair’s lowest since June 5, before trimming losses at settle at 1.5416, down 0.55% for the day and 1.97% lower for the week.

Cable is likely to find support at 1.5290, the low of June 5 and resistance at 1.5528, Friday’s high.

The dollar strengthened against the other major currencies on Wednesday after Fed Chairman Ben Bernanke said the bank could begin tapering its USD85 billion-a-month asset purchase program by the end of 2013 and wind it down completely by the middle of 2014 if the economy picks up as the central bank expects.

The bank said it expects the U.S. economy to grow between 2.3% and 2.6% in 2013. The Fed also said it expects the unemployment rate to fall to between 6.5% and 6.8% by the end of 2014 and inflation to edge closer to its 2% target.

In the U.K., Wednesday’s minutes of the Bank of England’s June meeting showed that three policymakers, including outgoing Governor Mervyn King voted in favor of additional easing, unchanged from the previous month.

The BoE said recent economic data has been largely positive and was consistent with the slow but sustained recovery outlined in the bank’s quarterly forecasts in May.

Data on Thursday showed that that U.K. retail sales rose 2.1% in May, outstripping expectations for a 0.8% gain, and were 1.9% higher on a year-over-year basis. The robust data added to the view that the economic recovery in the U.K. is gaining traction in the second quarter.

In the week ahead, investors will be closely watching U.S. data on durable goods orders, jobless claims and consumer confidence for signs that the economic recovery is on track.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.

Tuesday, June 25

The U.K. is to publish industry data on mortgage approvals, a leading indicator of demand in the housing sector. Meanwhile, BoE policymakers are to testify on inflation and the economic outlook before the parliamentary treasury committee.

The U.S. is to publish official data on durable goods orders, a leading indicator of production, as well as closely watched reports on consumer confidence and new home sales.

Wednesday, June 26

The BoE is to release its financial stability report, while the U.K. is to release private sector data on retail sales.

Later Wednesday, the U.S. is to release revised data on first quarter economic growth as well as government data on crude oil stockpiles.

Thursday, June 27

The U.K. is to publish official data on the current account and revised data on first quarter economic growth.

The U.S. is to release the weekly government report on initial jobless claims along with data on personal income and expenditure, which is to be followed by private sector data on pending home sales.

Friday, June 28

The U.S. is to round up the week with a report on manufacturing activity in Chicago and revised data from the University of Michigan on consumer sentiment.

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Crude oil futures - Weekly outlook: June 24 - 28

New York-traded crude oil futures ended Friday’s session at a three-week low, as a combination of concerns over an end to the Federal Reserve’s asset purchase program and fears over a deepening slowdown in China weighed.

On the New York Mercantile Exchange, light sweet crude futures for delivery in August fell 1.3% Friday to settle the week at USD93.89 a barrel by close of trade.

Earlier in the session, oil prices hit a daily low of USD93.13 a barrel, the weakest level since June 4. On the week, Nymex oil futures lost 4.3%.

Oil prices plunged 3% on Thursday after Fed Chairman Ben Bernanke said the central bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects.

The bank said it expects the U.S. economy to grow between 2.3% and 2.6% in 2013. The Fed also said it expects the unemployment rate to fall to between 6.5% and 6.8% by the end of 2014 and inflation to edge closer to its 2% target.

Indications the Fed will begin to taper asset purchases sent the U.S. dollar higher across the board. 

The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, gained 0.75% on Friday to end at a two-week high of 82.61.

Oil prices typically weaken when the U.S. currency strengthens as the dollar-priced commodity becomes more expensive for holders of other currencies.

Meanwhile, concerns over China’s economic outlook also weighed after data Thursday showed that manufacturing activity hit a nine-month low in June.

China’s HSBC preliminary manufacturing purchasing managers’ index fell to 48.3 in June from 49.2 in May as new orders declined, indicating that the slowdown in manufacturing is worsening.

China is the world's second largest oil consumer after the U.S. and has been the engine of strengthening demand.

In the coming week, investors will be closely watching U.S. data on durable goods orders, jobless claims and consumer confidence for signs that the economic recovery is on track.

Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for August delivery fell 1.2% on Friday to settle the week at USD100.94 a barrel, the lowest level since June 3.

The London-traded Brent contract lost 4.65% over the week, while the spread between the Brent and the crude contracts stood at USD7.05 a barrel.

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AUD/USD Forecast June 24-28

The Australian dollar dropped sharply last week, losing over 300 points against the surging US dollar. AUD/USD closed the week just above the 92 level, at 0.9212. This week’s sole release is Private Sector Credit. Here is an outlook of the events and an updated technical analysis for AUD/USD.

Australian number were respectable last week, as New Motor Vehicles Sales and the CB Leading Index posted better numbers than the previous month. However, the Aussie took it on the chin as the US dollar was broadly stronger, following  remarks from the Federal Reserve that it plans to taper QE later this year.

AUD/USD graph with support and resistance lines on it. Click to enlarge: 

1. Private Sector Credit: Friday, 1:30. This indicator measures the change in the amount of credit issued to businesses and consumers. An increase in borrowing signals more spending in the private sector, which is critical for economic growth. The indicator has been quite steady, and rose 0.3% in the previous release, which matched the forecast. No significant change is expected in the upcoming release.

Live Chart of AUD/USD:

AUD/USD Technical Analysis

AUD/USD was sharply lower last week. The pair opened at 0.9565 and quickly touched a high of 0.9641. The pair then slid all the way to 0.9163, before closing the week at 0.9212, as support at 0.9171 (discussed last week) remained intact.

Technical lines from top to bottom:   

With the sharp losses by AUD/USD, last week saw multi-year support levels give way. We start with strong resistance at 1.0183. This line last saw action in early May. The next line of resistance is at 1.0093. This is followed by the parity line, which AUD/USD broke through in mid-May, as it continues to push to lower levels.

The next resistance line is at 0.9913. This is followed by 0.9797, which was last tested in mid-May. The next resistance line is at 0.9634. This line has strengthened as the pair trades at lower levels.

0.9549 has reverted to a resistance role. Next is 0.9428, which has been busy in June. Prior to this month, this line had provided strong support, and had not been breached since October 2011. The line of 0.9275 also gave way, as the pair broke below it for the first time since September 2010.

This is followed by support at 0.9171. Next, there is support at 0.9041, protecting the all-important 90 level.

0.8893 was last breached in August 2010, as the Australian dollar put together a strong rally which saw it climb above the 1.10 line. The final line for now is 0.8747, which has remained in place since July 2010.

I continue to be bearish on AUD/USD.

The Aussie is in a bad slump, and we could see nervous investors dump there Australian dollars and seek the safety of the US dollar. The greenback is broadly strong courtesy of the US Federal Reserve, and the fallout from the QE announcement could continue into next week.

The Aussie sometimes moves in tandem with gold. You can trade binary options on gold using this technical analysis.

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USD/JPY Outlook June 24-28

FTS-Forex Trading: The US dollar finally flexed some muscle this week, and pushed down the yen about 350 points. The pair closed the week just above the 97 level, at 97.01. There are several major releases, this week, including Tokyo CPI and Household Spending. Here’s an outlook for the Japanese events and an updated technical analysis for USD/JPY.

The US dollar was broadly stronger last week, thanks to remarks by the US Federal Reserve that it plans to taper QE during 2013. The yen also took a hard hit, reversing its recent gains against the dollar.

USD/JPY daily chart with support and resistance lines on it. Click to enlarge:

1. CSPI: Monday, 23:50. Japanese inflation numbers continue to be under the market’s microscope, as the government has embarked on an aggressive monetary easing  program in order to stamp out deflation and increase economic activity. CSPI, which measures corporate inflation,  has not responded as hoped, as only one reading has been above the zero level this year, as deflation continues. The previous release posted a decline of -0.4%, missing the estimate of -0.2%. The markets are expecting better news in the June release, with an estimate of a o.1% gain.
2. All Industries Activity: Thursday, 4:30. This indicator measures the change in the amount of goods and services purchased by Japanese businesses. Although the indicator has shown sharp movement from one month to the next, the markets have done a good job of providing accurate forecasts. The indicator posted a decline of -0.3% last month, but the markets are expecting a turnaround in the June release, with an estimate of 0.5%.
3. Manufacturing PMI: Thursday, 23:15. Manufacturing PMI is based on a survey of purchasing managers who are asked to rate conditions in the manufacturing industry. The index has been climbing slowly but steadily all year, and has been above the 50-level, which indicates expansion, since the February release.
4. Household Spending: Thursday, 23:30. Consumer spending is one of the most important economic indicators, as it comprises a majority of Japan’s economic activity. The indicator has been quite erratic, making accurate estimates a difficult task. Household Spending dropped 1.5% in the May release, and no change is expected in the upcoming reading.
5. Tokyo Core CPI: Thursday, 23:30. This index is considered the most important Japanese inflation indicator, and should be treated as a market-mover. The index posted a modest gain of 0.1% in the May reading, the first sign of inflation in almost two years. Will the index post another reading above zero? The markets are expecting so, with an estimate of 0.2% for the June release.
6. Preliminary Industrial Production: Thursday, 23:50. This indicator has been very weak, with five consecutive declines until a gain of 1.8% last month. This surprised the markets, which had forecast a decline of -1.8%. The estimate for the June release is stands at -1.7%. Will the indicator again surprise the markets with a strong reading?
7. Retail Sales: Thursday, 23:50. This important consumer spending indicator has looked dismal, with four straight declines. The estimate for the June reading is a small gain of 0.1%, which would be welcome news from the hard-hit indicator.
8. Housing Starts: Friday, 5:00. With all the problems facing the Japanese economy, Housing Starts continue to post strong gains. The indicator has beaten the estimate for the past three releases. Housing Starts gained 5.8% in the May reading, and the markets are expecting an even stronger release this time around, with an estimate of 6.3%.

*All times are GMT.

USD/JPY Technical Analysis

The yen started the week at 94.33. After touching a low of 94.23, USD/JPY roared higher, climbing to a high of 98.29. The pair closed the week at 97.90, as the resistance line of 97.80 has reverted to a support role (discussed last week).

Live chart of USD/JPY:

Technical lines from top to bottom

With USD/JPY posting sharp gains, we start at higher levels. The pair faces resistance at 101.52, which has held firm since late May. This is followed by 100.85.

Next, there is resistance at the all-important round number of 100. USD/JPY broke below this line in early June as the yen gained strength.. 98.90 capped the pair in June 2009 and is the next line of resistance.

Next, 97.80 has seen a lot of action in June, and has reverted to a support role. This is a weak line, and could be tested early next week.

The round 97 line also worked as important support in May and is back providing support. Given the volatility we continue to see from the pair, it cannot be considered a strong line.

The March 2013 peak of 96.71 is providing strong support. Next is the round number of 95, which was breached early last week as USD/JPY surged upwards.

0.9406 was providing weak support at the start of last week, but has now strengthened as the pair trades at higher levels.

Below, 0.9277 has held firm since April. It is followed by 91.19, which has not been tested since February.

Next is the critical line of 90. This psychologically important support level has remained intact since January.

We are bullish on USD/JPY

Until last week, the yen owned June and posted outstanding gains against the US dollar. Last week’s correction pushed the pair to the 98 line, as the broadly stronger dollar rebounded sharply. The fallout from the QE announcement may not be over, and we could see the pair move closer to the 100 level.

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EUR/USD Forecast June 24-28

FTS-Forex Trading: EUR/USD advanced to new highs only to crash on the prospects of QE tapering in the US. Is it set to lose 1.30, or can we expect it to stabilize? German Ifo Business Climate, and German employment data are the highlights of this week. Here is an outlook for the events that will move the euro and an updated technical analysis for EUR/USD.

Ben Bernanke laid out a path for tapering the Fed’s bond buys, and this sent the euro from the highs of 1.34 to below 1.32. While the euro showed relative resilience, the flock into US dollars took its toll. ECB President Mario Draghi announced in a speech that he is willing to use “non-standard” monetary measures if worse comes to worse. A negative deposit rate is a valid option to which ended up in hurting the Euro. Long-term lending operations and modifying collateral requirements are other possibilities Draghi considers to save the Euro-area from a further plunge. Will Draghi enact these measures in the coming months?

EUR/USD daily graph with support and resistance lines on it. Click to enlarge:

1. German Ifo Business Climate: Monday, 8:00. German business sentient increased unexpectedly in May to 105.7 points from 104.4 points in April amid improvement in businesses and growing optimistic about the future. The increase came after two straight declines. Another rise to 106 is expected.
2.  Belgium NBB Business Climate: Monday, 13:00. Belgian business confidence, improved more than expected in May, rising to -12.4 from -14.7 in April amid gains in construction and business-related services sectors. Economists expected a minor rise to -13.4.  A further advance to -11.1 is expected now.
3. Italian Retail Sales: Tuesday, 8:00. Retail sales edged down 0.3% in March, after declining 0.2% in February. The drop was contrary to predictions of a 0.3% increase. On a year-on-year basis, retail sales dropped 3.0% in March after registering a 4.8% fall in February. No change is expected this time.
4. GfK German Consumer Climate: Wednesday, 6:00. German Consumer Sentiment is expected to reach 5-year high of 6.5 in June, according to GfK forecast, amid improvement in the job market and lower inflation boosting consumer spending. Households were the main factor behind Germany’s 0.1% growth in the first quarter. Gfk projects recovery will continue in 2013 at a moderate pace. Another rise to 6.6 is forecasted.
5. German Import Prices: Thursday, 8:00. Import prices in Germany fell 1.4% in April, worse than the 0.2% projected, following a 0.1% dip in March. However, on an annual bases, import prices fell 3.2% in April after a 2.3% decline in March affected by the slow Eurozone recovery. A decline of 0.1% is predicted.
6. German Unemployment Change: Thursday, 7:55. German unemployment list increased more than expected in May adding 21,000 to 2.963 million, however the unemployment rate remained low. Economists estimated a small rise of 4,000. Nevertheless, the overall the German labor market is still in a good condition. A small increase of 6,000 is expected this time.
7. M3 Money Supply: Thursday, 8:00. The Eurozone M3 money supply index for April 2013 increased 3.0%, beating the median estimate of 2.9%. The annual M3 seasonally adjusted for April registered an increase of 3.2% above expectations of 2.9% better than the preceding month’s reading of 2.6%. A gain of 2.9% is projected now.
8. Retail PMI: Thursday, 8:10. The Purchasing Managers Index for traders in the Eurozone edged up to an eight-month high of 46.8 following 44.2 in the previous month but still remains below the 50 point line, indicating contraction. Overall retail in the euro area remained in contraction in May.
9. EU Economic Summit: Thu-Fri. The two-day EU summit in Brussels will discuss unemployment, especially youth unemployment since joblessness in the EU continues to rise. Germany will likely refrain from further loans to its EU neighbors due to the approaching elections in September. Therefore the important decisions are likely to be postponed until the next EU meeting in December.
10. German Retail Sales: Friday, 8:00. German retail sales dropped 0.4% in April following a 0.5% dip in the previous month missing market predictions of a 0.3% rise. The possible reason behind the weaker-than-expected reading is that the cold winter was prolonged this year pushing prices for seasonal vegetables higher, causing households to cut back on spending. Retail sales are expected to advance 0.4% in May.
11. German CPI: Friday. Consumer prices edged up 0.4% in May, beating predictions for a 0.2% rise, adding 0.3% to the annual inflation rate which now stands at 1.5 percent, its highest level since February. This increase was preceded by a 0.5% decline in April. The main pressure on prices was apparent in package vacations while energy bills dropped sharply. Nevertheless the ECB does not have to be concerned with rising inflation. No change is forecast. German inflation has a strong influence on the ECB.
12. French Consumer Spending: Friday, 8:45. Consumer spending in France, declined less than expected in April, down 0.3% from a 1.3% gain in March. Food expenditure declined 3.3% from March. Car sales increased 1.8% in April. Rising unemployment hinders a recovery in consumer spending, which in turn affects the overall economic expansion. Consumer spending is expected to remain unchanged this month.

*All times are GMT

EUR/USD Technical Analysis

Euro/dollar started the week by continuing its previous advance along the steep uptrend support line (mentioned last week) and topped out at 1.3420. From there, it was all downhill. The pair initially traded between the 1.3160 and 1.3255 lines before making another move lower and finding support down at 1.31. It closed at 1.3119.

Technical lines from top to bottom:

We start from lower ground this time. 1.3480 was the “shoulders” of an old H&S pattern. 1.3434 is a line in the middle of the 1.34 to 1.3480 range.

The round line of 1.34 served in both directions when the pair traded in higher ground. The pair temporarily breached this line in June.  1.3350 provided support when the pair traded higher in February and now serves as a pivotal line.

1.3255 provided support during January 2013 and also beforehand. A recovery attempt failed to reconquer this line at first, but now this line is strong support. 1.32 is a clear top after capping the pair twice in April 2012 and then in May. This is a round number as well.

1.3160, which separated ranges in May 2013 is strengthening once again and worked perfectly well as a cap to a recovery attempt in June. 1.3100 is a minor line after working as temporary resistance in December 2012.

It is followed by 1.3050, which proved be strong support in May 2013, defending the round number in more than one occasion, and now works as support. The very round 1.30 line was a tough line of resistance and is becoming stronger after serving as a double top in May 2013. In addition to being a round number, it also served as strong support and recently worked as a pivot line.

1.2940 is the next line of support, replacing 1.2960. It worked as such during April and May 2013. Lower, 1.2890 worked in both directions during 2012 and was the beginning of the uptrend support line. It is somewhat weaker now.

1.2840 worked as a cushion for the pair during May 2013 and is a pivotal line at the moment. Lower, the round number of 1.28 was the bottom of a long term wide range in 2012 and its breach in May 2013 was not confirmed.

Below, 1.2750 worked as a separator of ranges during November, and stopped the pair’s drop in March. This is a key line on the downside, as clearly shown in the first week of April. This is followed by the round number of 1.27, which is a minor line.

Steep uptrend support broken

As the thick black line on the chart shows, EUR/USD clearly fell off this line and began a sharp move lower.

I am bearish on EUR/USD

The Fed said its word and it is dollar positive. While the move could have been a bit overdone, the US dollar is expected to remain bid. If no disaster happens, the next move in the US is a reduction of the pace of monetary stimulus rather than an increase.

Even if euro-zone numbers are not always that bad, the economy is still squeezing and more monetary stimulus cannot be ruled out. Current expectations for the July rate decision are for no big changes. If we get weaker indicators or dovish talk, the euro could tumble lower.

More technical analysis:

• EUR/USD Extends Decline towards 1.3000 and Lower - by James Chen
• EUR/USD, Gold update after Bernanke - Elliott Wave Analysis

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Forex - USD/CHF weekly outlook: June 24 - 28

The broadly stronger dollar ended the week higher against the Swiss franc on Friday after the Federal Reserve indicated that it may start to unwind its asset purchase program later this year.

USD/CHF hit highs of 0.9367 on Friday; the pair’s highest since June 10, before settling at 0.9340 at the close of trade, up 0.77% for the day and 1.39% higher for the week.

The pair is likely to find support at 0.9240, Friday’s low and resistance at 0.9417, the high of June 10.

The dollar rallied after Fed Chairman Ben Bernanke said Wednesday that the bank could begin slowing its USD85 billion-a-month bond purchasing program by the end of 2013 and wind it down completely by the middle of 2014 if the economy picks up as the central bank expects.

The bank said it expects the U.S. economy to grow between 2.3% and 2.6% in 2013. The Fed also said it expects the unemployment rate to fall to between 6.5% and 6.8% by the end of 2014 and inflation to edge closer to its 2% target.

On Thursday, the Swiss National Bank kept monetary policy unchanged following its policy setting meeting and said the Swiss franc remains “high”.

The SNB left its benchmark interest rate unchanged at zero, in line with expectations. 

The bank also maintained the minimum exchange rate floor at 1.20 per euro saying the measure is “important in order to avoid an undesirable tightening of monetary conditions.” 

The central bank reiterated that it would defend the exchange rate floor by buying foreign currency in unlimited quantities in necessary.

The SNB said it still anticipates growth in a range of 1% to 1.5% in 2013 but warned that risks to the economy remained high, saying “tensions can reappear at any moment on global financial markets.”

In the week ahead, investors will be closely watching U.S. data on durable goods orders, jobless claims and consumer confidence for signs that the economic recovery is on track. 

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.

Tuesday, June 25

The U.S. is to publish official data on durable goods orders, a leading indicator of production, as well as closely watched reports on consumer confidence and new home sales.

Wednesday, June 26

The U.S. is to release revised data on first quarter economic growth as well as government data on crude oil stockpiles.

Thursday, June 27

The U.S. is to release the weekly government report on initial jobless claims along with data on personal income and expenditure, which is to be followed by private sector data on pending home sales.

Friday, June 28

Switzerland is to publish its KOF economic barometer, an important indicator of economic health.

The U.S. is to round up the week with a report on manufacturing activity in Chicago and revised data from the University of Michigan on consumer sentiment.

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Gold / Silver / Copper futures - Weekly outlook: June 24 - 28

FTS-Forex Trading: Gold and silver futures ended Friday’s session higher, as investors returned to the market to seek cheap valuations after prices fell to the lowest level since September 2010 earlier in the session.

Sentiment on the precious metals was dampened amid expectations the Federal Reserve will begin to taper off its bond-buying program by the end of this year.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery rose 0.75% on Friday to settle the week at USD1,295.55 a troy ounce. 

Earlier in the session, Comex gold prices fell to a daily low of USD1,268.75 a troy ounce, the weakest level since September 16.

For the week, gold prices lost 6.8%, the worst weekly decline since September 2011. 

Gold futures were likely to find support at USD1,246.20 a troy ounce, the low from September 14, 2010 and near-term resistance at USD1,310.10, the high from September 28, 2010.

Gold prices plunged more than 5% on Thursday after Fed Chairman Ben Bernanke said the central bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects.

Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank would end its bond-buying program sooner-than-expected.

An exit from the stimulus would deal a heavy blow to gold, which has thrived on demand from investors who buy gold to hedge against the inflationary risks of loose monetary policies. 

Indications the Fed will begin to taper asset purchases sent the U.S. dollar higher across the board. 

The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, gained 0.75% on Friday to end at a two-week high of 82.61.

A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.

In the coming week, investors will be closely watching U.S. data on durable goods orders, jobless claims and consumer confidence for signs that the economic recovery is on track.

Any improvement in the U.S. economy could scale back expectations for further easing, putting upward pressure on U.S. yields and boosting the dollar.

Elsewhere on the Comex, silver for July delivery rallied 2.2% on Friday to settle the week at USD20.00 a troy ounce. Despite Friday’s upbeat performance, silver future prices lost 9.15% on the week.

On Thursday, Comex silver prices plunged 7.3% to hit a 33-month low of USD19.55 a troy ounce.

Meanwhile, copper for July delivery climbed 2.1% on Friday to close the week at USD3.100 a pound. Despite Friday’s gains, Comex copper prices dropped 2.95% on the week.

The industrial metal fell to a 20-month low of USD3.019 a pound on Thursday, as a combination of concerns over an end to the Fed’s assets purchase program and fears over a deepening slowdown in China weighed.

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Forex - Weekly outlook: June 24 - 28

FTS-Forex Trading: The dollar ended the week sharply higher against the other major currencies on Friday after the Federal Reserve said Wednesday it could start scaling back its bond buying program by the end of the year.

The dollar strengthened against the yen, with USD/JPY climbing 3.82% for the week to settle at 97.88, the largest weekly gain since December 2009.

The euro fell against the dollar, with EUR/USD dropping 1.7% for the week, to close at 1.3119, the biggest weekly decline since early February.

The dollar rallied after Fed Chairman Ben Bernanke said the bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects.

The bank said it expects the U.S. economy to grow between 2.3% and 2.6% in 2013. The Fed also said it expects the unemployment rate to fall to between 6.5% and 6.8% by the end of 2014 and inflation to edge closer to its 2% target.

The euro came under pressure on Friday after Greece’s Democratic Left party withdrew from the coalition government in protest over planned public sector layoffs, leaving the government with only a slim majority in parliament.

The Canadian dollar fell to 20-month lows against the greenback on Friday after official data showed that Canadian consumer inflation rose less-than-expected in May, and Canadian retail sales came in below expectations in April.

USD/CAD hit 1.0487 on Friday, the pair’s highest since late November 2011, before trimming gains to settle at 1.0451, up 2.67% for the week.

The Australian dollar ended the week close to 33-month lows against the greenback as a combination of concerns over an end to the Fed’s assets purchase program and fears over a deepening slowdown in China weighed.

AUD/USD hit 0.9161 on Thursday, the pair’s lowest since September 2010, before settling at 0.9217 by the close of trade on Friday, down 3.58% for the week.

The New Zealand dollar fell to one-year lows against the greenback on Friday, with NZD/USD falling 3.76% for the week.

In the week ahead, investors will be closely watching U.S. data on durable goods orders, jobless claims and consumer confidence for signs that the economic recovery is on track. A European Union economic summit will also be in focus as concerns over the economic outlook for the euro zone linger.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, June 24

The Ifo institute is to release a report on German business climate, a leading indicator of economic health.

Tuesday, June 25

The U.K. is to publish industry data on mortgage approvals, a leading indicator of demand in the housing sector. Meanwhile, Bank of England policymakers are to testify on inflation and the economic outlook before the parliamentary treasury committee.

In the euro zone, Italy is to hold an auction of 10-year government bonds.
The U.S. is to publish official data on durable goods orders, a leading indicator of production, as well as closely watched reports on consumer confidence and new home sales.

Wednesday, June 26

Germany is to release the Gfk report on consumer climate, a leading indicator of consumer spending.

The BoE is to release its financial stability report, while the U.K. is to release private sector data on retail sales.

Later Wednesday, the U.S. is to release revised data on first quarter economic growth as well as government data on crude oil stockpiles.

Thursday, June 27

New Zealand is to release official data on the trade balance, the difference in value between imports and exports, as well as data on business confidence.

In the euro zone, European Union leaders are to hold the first day of a two day economic summit. Germany is to release official data on the change in the number of people unemployed, a leading economic indicator.

The U.K. is to publish official data on the current account and revised data on first quarter economic growth.

Later Thursday, the U.S. is to release the weekly government report on initial jobless claims along with data on personal income and expenditure, which is to be followed by private sector data on pending home sales.

Friday, June 28

Japan is to release a series of economic data, including reports on household spending, inflation, retail sales and preliminary data on industrial production.

Australia is to publish government data on private sector credit.
In the euro zone, EU leaders are to hold the second day of a two day economic summit in Brussels.

Germany is to release preliminary data on consumer price inflation, which accounts for a majority of overall inflation, while France is to produce data on consumer spending. 

Switzerland is to publish its KOF economic barometer, an important indicator of economic health.

Later in the day, Canada is to publish its monthly report on gross domestic product, the broadest indicator of economic activity and the leading measure of the economy’s health.

The U.S. is to round up the week with a report on manufacturing activity in Chicago and revised data from the University of Michigan on consumer sentiment.

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