Weekly Market Outlook: Key Economic Events & Trends (February 17-21, 2025)

As global markets prepare for a crucial week, investors will closely monitor major economic releases, central bank decisions, and inflation trends to assess the strength of global economies. With geopolitical uncertainty, inflation risks, and shifting monetary policies dominating the financial landscape, this week’s data will provide key insights into interest rate directions and market momentum.

📌 What to Watch This Week:
✔ Will the U.S. inflation data impact Federal Reserve rate decisions?
✔ How will the Reserve Bank of Australia’s rate cut affect the Australian dollar (AUD)?
✔ What do labor market reports from the UK and Canada reveal about economic strength?
✔ Can European and U.S. PMIs signal economic recovery or a slowdown?

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📉 Major Economic Events to Watch (February 17 – 21, 2025)

🔹 Tuesday, February 18 – Australia’s Interest Rate Decision (AUD)

📌 Event: RBA Cash Rate Decision | Time: 5:30 AM (GMT+2)
🔹 The Reserve Bank of Australia (RBA) is widely expected to cut interest rates by 25 basis points, bringing the cash rate down to 4.10% to combat slowing economic growth.
🔹 A rate cut could weaken the AUD, making it less attractive to forex traders.

📌 Market Impact:
✔ If the RBA cuts rates, AUD/USD could decline.
✔ If the RBA holds rates steady, the AUD may strengthen in the short term.

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🔹 Tuesday, February 18 – UK Unemployment Report (GBP)

📌 Event: UK Claimant Count Change | Time: 9:00 AM (GMT+2)
🔹 The UK labor market is showing signs of weakness, with rising unemployment claims signaling economic strain.
🔹 The jobless rate is currently 4.4%, and analysts expect an additional 10,000 new claims.

📌 Market Impact:
✔ A higher-than-expected unemployment rate could pressure the Bank of England (BoE) to lower interest rates.
✔ GBP/USD traders will closely monitor the labor market for signs of economic resilience.

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🔹 Wednesday, February 19 – U.S. Inflation Data (USD)

📌 Event: U.S. Consumer Price Index (CPI) | Time: 3:30 PM (GMT+2)
🔹 Inflation remains a key concern for the Federal Reserve, with core CPI expected to stay at 2.9% year-over-year.
🔹 If inflation exceeds expectations, the Fed may delay rate cuts, boosting the USD.

📌 Market Impact:
✔ Higher-than-expected CPI could strengthen the USD and weaken gold (XAU/USD).
✔ A lower CPI reading might increase expectations for a Fed rate cut in 2025.

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🔹 Thursday, February 20 – U.S. Jobless Claims (USD)

📌 Event: U.S. Unemployment Claims | Time: 3:30 PM (GMT+2)
🔹 The U.S. labor market remains resilient, with jobless claims expected to rise slightly to 214,000.
🔹 A stronger labor market could delay rate cuts, keeping the USD firm.

📌 Market Impact:
✔ A decline in jobless claims could push the USD higher.
✔ If jobless claims rise, markets may expect the Fed to cut rates sooner.

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🔹 Friday, February 21 – Key European PMI Reports (EUR, GBP)

📌 Event: Manufacturing & Services PMI Data (Germany, France, UK)
🔹 Germany’s manufacturing PMI is projected at 45.4, indicating contraction.
🔹 France’s services PMI is forecast at 49.0, signaling continued weakness.
🔹 UK’s manufacturing PMI is expected to remain below 50, reflecting slower growth.

📌 Market Impact:
✔ Weak PMI numbers could pressure the European Central Bank (ECB) and Bank of England (BoE) to maintain or cut rates.
✔ Stronger-than-expected PMI readings may boost the EUR and GBP.

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📊 Market Outlook – What to Expect This Week?

✔ U.S. inflation data will be the biggest market mover, influencing Federal Reserve policy decisions.
✔ Australia’s expected rate cut could weaken the AUD, impacting forex traders.
✔ Labor market reports from the UK and Canada will provide key economic insights.
✔ PMI data from Europe and the U.S. will indicate whether economies are expanding or slowing.

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