Weekly Recap: 3-7 May

Last week was full of Data and statements. The US dollar’s decline in favor of risk assets has dominated the markets last week after economic data and monetary policy decisions.

US Dollar

The week was full of events that led to a noticeable decline in the price of the US dollar after the statements of Federal Reserve officials confirming that it is still too early to raise interest rates and that the road to recovery is still long, which led to the US dollar giving up gains.

A series of US data showed that the US labor market conditions were below expectations. The US dollar index, which measures the strength of the greenback against a basket of currencies, fell to 90.24 against last week’s close of 91.23.

Euro

The European currency ended last week’s trading on positive side on the European economic data, with the easing of restrictions, in addition to the losses in the US dollar.

German Treasury yields rose on optimism over coronavirus vaccines and some restrictions easing. The EUR/USD pair rose to 1.2162 vs. last week’s close of 1.2016. It recorded a weekly low of 1.1985 and a high of 1.2171.

Pound

The Sterling ended last week’s trading in a bullish direction, as the Bank of England kept monetary policy unchanged. The Bank of England interest decision statement stated that the Bank of England will keep monetary conditions and interest rates unchanged as the asset purchase program remains stable as it needs strong evidence of economic recovery before changing monetary policy.

The GBP/USD rose to 1.3985 against the previous week’s close of 1.3815. The pair fell to its lowest level over the past week at 1.3800 against highs of 1.4000.

Gold

Gold made a significant rise last week as the US dollar fell. Gold ended last week’s trading at 1831, against last week’s closing at 1768.

Calendar

Industrial Production in Germany increased in March, the official data showed on Friday, suggesting that the recovery in the manufacturing sector is gaining momentum.

The industrial output rose by 2.5% MoM, the federal statistics authority Destatis said in figures adjusted for seasonal and calendar effects, vs. a 2.3% rise expected and -1.9% last.

On an annualized basis, the German industrial production jumped by 5.1% in March versus a -6.8% drop recorded in February.

The German Current Account data came in at EUR30.2B in March vs. EUR18.8B prior. Meanwhile, the Trade Surplus narrowed to EUR14.3B vs. EUR18.9B last.

The German Factory Orders increased as much more than expected in March, suggesting that the manufacturing sector in Europe’s economic powerhouse sees an impressive post-pandemic recovery.

Contracts for goods ‘Made in Germany’ arrived at 3% on the month vs. 1.7% expected and 1.4% last, the latest data published by the Federal Statistics Office showed on Thursday.

On an annualized basis, Germany’s Industrial Orders leaped by 27.8% in the reported month vs. 5.8% previous and an expected rise of 4.1%.

Nonfarm Payrolls (NFP) in the US rose only by 266,000 in April, the data published by the US Bureau of Labor Statistics showed on Friday. This reading followed March’s increase of 770,000 (revised from 916,000) and missed the market expectation of 978,000 by a wide margin.

Coronavirus

Britain announced that the new cases of Covid-19 recorded in the country amounted to 1770 cases today, Sunday, with the total number of cases recorded within seven days declining to 14,659, a decrease of 4.3% compared to the previous seven days.

Two new deaths were recorded within 28 days of testing positive for COVID-19.

The total deaths during the seven days reached 67 cases, a decrease of 39.1% compared to the previous seven days.

The data shows that 35.37 million people, or 67% of the adult population, have received the first dose of the protective Covid-19 vaccine.

The Italian Ministry of Health said that it recorded 139 deaths from the Corona virus today, Sunday, from 224 yesterday, while the daily infection cases decreased to 8292 compared to 10 thousand and 176 yesterday.

Italy has recorded 122,833 deaths related to Covid-19 since the outbreak of the pandemic in it in February of last year, the second highest in Europe after Britain and the seventh in the world.