Financial
markets' participants will be carefully watching a number of important reports,
the foremost of which is the jobs report in the United States, in addition to the
final Manufacturing and Service PMI released from a number of major economies.
It
should be noted that the indicators of manufacturing and services published by
the Chinese economy are expected to be of great importance in light of the spread
of the Corona virus inside and outside China.
US
Dollar
Certainly,
the jobs report is expected to be the most important and influencing on the
movements of the U.S. dollar, as it is considered a leading indicator used by
the Federal Reserve to determine the future of monetary policy.
The
non-farm payrolls may indicate that American employers created 178,000 jobs in
February, and the unemployment rate has stabilized at 3.6 percent, according to
median forecasts.
The
final composite purchasing managers' report for the services and manufacturing
sectors for February will also be of interest to investors, as it may give an
initial impression of the pace of growth in the US economy in the first
quarter.
The
Composite PMI may point to contraction to 49.6 in February, compared to
January's reading of 53.3. A reading above 50 indicates growth while a below it
refers to contraction.
It
is worth noting that there is a growing expectation that the Fed may cut
interest rates in either March or April to overcome the negative economic effects
related to the spread of the Coruna virus.
Euro
The
euro will likely be affected by the release of important economic data from the
euro area, as investors will focus on the final manufacturing and services PMI readings.
The
Composite index, which includes both manufacturing and services, may confirm
the improvement in growth in February to 51.6 from 51.3 recorded in January.
Investors
will also give attention to inflation data, where the flash consumer price
index (CPI) in the eurozone may signal deceleration to 1.3 percent in the year
through February from a previous of 1.4 percent.
Pound
Sterling
This
week, the UK will release its final PMI for the services, manufacturing and
construction sectors for February. These indicators mainly provide the latest
updates on the health of the British economy.
Expectations
indicate stability at 53.3 in February, according to analysts' forecasts for
the final composite PMI compiling the three sectors. Other than this report,
the pound might move according to the general market sentiment.
Commodities
Gold
hit a record high last week, benefiting from the panic in financial markets amid
the rapid spread of the Corona virus outside China, as well as the decline in
the US dollar, but the precious metal dropped significantly at the end of the
week in light of profit-taking by investors.
The
yellow metal this week will largely depend on the important economic data
issued by the major economies. In the event of any signs of global slowdown,
this would boost expectations that central banks will reduce interest rates, and
thereby this should provide support to gold prices.
With
regard to crude oil, prices fell sharply in the past week to record the largest
decline in more than four years, as the spread of the Corona virus outside
China increased fears of a slowdown in global demand for oil and its products.
Oil price movements
this week will depend on the developments of the virus, as well as the weekly
US government report tracking the change in crude stockpiles.