The final full week of January will be off to a slow start on Monday, with very few economic data releases scheduled. In the interim, investors will continue to analyze a shutdown of the US government after lawmakers failed to pass a new spending measure.
The US federal government officially closed its doors on Saturday after a proposed extension was voted down by the Republican-controlled Senate. The measure would have kept the government functioning through 16 February.
US stock futures were down across the board on Monday, which pointed to a soft start to the day on Wall Street. Political uncertainty surrounding the Trump administration was a thorny issue for investors during the first year the administration was in office.
In terms of economic data, the Greek government will report on the current account balance at 09:00 GMT. Athens reported a current account deficit of €624 million for October.
Shifting gears to the United States, the Chicago Federal Reserve Bank will issue its national activity index for the month of December. The monthly reading is forecast to rise to 0.44 from 0.15 in November.
North of the border, the Canadian government will report on wholesale sales for the month of November. Sales are projected to rise 0.6% in November after climbing 1.5% the month before.
Attention quickly shifts to monetary policy on Tuesday as the Bank of Japan (BOJ) votes on interest rates. No changes are expected at this time.
The European Central Bank (ECB) is also scheduled to vote on interest rates later this week.
In terms of forthcoming data releases, US GDP, durable goods orders and housing sales will be reported throughout the week.
EUR/USD
Europe’s common currency is trading well off last week’s peak, but continues to show strong upside momentum. The EUR/USD is trading well above 1.2200 and is likely to continue higher now that a US government shut down has undermined demand for the greenback.
GBP/USD
The British pound closed out another solid week against the dollar, with the cable briefly rising above 1.3900. The GBP/USD exchange rate was last up 0.1% at 1.3861. The pair faces immediate resistance at 1.3900, followed by the 1.3945 level. Support is located at 1.3800.
USD/JPY
After staging a mild recovery last week, the US dollar drifted lower against the Japanese yen, a sign that bearish pressure remained. The USD/JPY exchanger rate retreated from a high of around 111.40 all the way down to 111.50 amid concerns of a US government shutdown. With the US government shutting down, demand for the yen will likely stay elevated over the short term. The pair was last seen trading at 110.79 for a gain of 0.2%.
