Forex - Weekly outlook: March 28-April 1

Investing.com – Last week saw the U.S. dollar rally against most of its major counterparts after government data on Friday showed that the U.S. economy grew at a faster pace than previously estimated in the fourth quarter, boosting hopes that the U.S. economic recovery was strengthening. 

The U.S. Bureau of Economic Analysis said on Friday that fourth quarter gross domestic product came in stronger-than-expected, rising at an inflation-adjusted annual rate of 3.1%, more than the expected 2.9% gain.

Meanwhile, the euro retreated from a four-month high against the U.S. dollar amid mounting fears over Portugal’s sovereign debt crisis, following the collapse of the nation’s government earlier in the week.  

On Friday, the yield on Portuguese government bonds hit a fresh euro lifetime high after Standard & Poor's downgraded the country's debt ratings, while German Chancellor Angela Merkel said it would take the euro "years to recover from the sins of the past”.

The pound slipped against the greenback after the U.K. government cut its growth forecasts for 2011 and markets pared back expectations for a near-term rate hike by the Bank of England.

Elsewhere, the Australian dollar rallied to an all-time high against its U.S. counterpart on Friday, boosted by an increase in risk appetite, with high Australian interest rates enhancing its appeal for global investors.

The Kiwi also performed strongly after Reserve Bank of New Zealand Governor Alan Bollard said the nation’s economy would get a boost from “a very big” construction boom, following the earthquake that struck Christchurch in late February.

Meanwhile, the Canadian dollar slumped against the greenback on Friday as opposition lawmakers toppled Prime Minister Stephen Harper’s Conservative Party government following a non-confidence motion.

In the week ahead, the U.S. is to release key data on nonfarm payrolls as well as a report on its unemployment rate, while the euro zone is to produce official preliminary data on inflation.

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

Monday

The U.S. is to kick off the week by releasing a flurry of data, with an industry report on pending home sales as well as official data on personal spending, personal income and personal consumption expenditures.

In the euro zone, ECB President Jean-Claude Trichet is to speak at the Academy of Sciences, in Paris; his comments will be closely watched for any clues to the possible future direction of monetary policy.

Elsewhere, Japan is to publish government data on retail sales, the primary gauge of consumer spending, which accounts for the majority of overall economic activity as well as data on household spending and a report on its unemployment rate.

Also Monday, New Zealand is to publish official data on its trade balance, the difference in value between imported and exported goods over the month.

Tuesday

In the euro zone, France is to release a government report on consumer spending, while Germany is to produce preliminary data on consumer price inflation. Also Tuesday, research group, Gfk, is to publish a report on German consumer climate, a leading indicator of consumer spending.

Meanwhile, the U.K. is to produce official data on its current account as well as final data on fourth quarter gross domestic product, the broadest measure of economic activity and the primary gauge of the economy’s health. The BoE is to release data on net lending to individuals, final mortgage approvals and M4 money supply.

The U.S. is to publish data on consumer confidence compiled by the Conference Board as well as industry data on house prices, a leading indicator of the housing industry's health.

Elsewhere, Switzerland is to publish the results of a consumption index, compiled by UBS.

Also Tuesday, Japan is to produce preliminary data on industrial production, New Zealand is to publish a report on building consents, while Australia is to release industry data on new home sales.

Wednesday

The U.S. is to publish data on private sector payrolls compiled by payroll processing firm ADP, which heads up government data by two days, as well as a report on crude oil stockpiles.

The U.K. is to publish industry data on retail sales, a leading indicator of consumer spending. Later in the day, market research group Gfk is to publish data on consumer confidence in the U.K.

Elsewhere, Switzerland is to publish the results of an economic index, compiled by the KOF Economic Research Agency, designed to predict the direction of the economy over the following six months.

Also Wednesday, Canada is to publish its raw materials price index, a leading indicator of consumer price inflation, while Japan is to produce data on manufacturing activity.

Thursday

The U.S. is to release its key weekly report on initial jobless claims, a leading indicator of overall economic health. The country is also to publish a report on manufacturing activity in the in the Chicago area as well as official data on factory orders and natural gas inventories.

In the euro zone, Germany is to publish official data on employment change and retail sales, while both Italy and the wider economic zone is to publish preliminary data on consumer price inflation as well as a report on the unemployment rate.

In addition, ECB President Jean-Claude Trichet is to speak at a public engagement in China. Traders scrutinize his public engagements as they are often used to drop subtle clues regarding future monetary policy.

The U.K. meanwhile is to publish industry data on house prices, an important indicator of the housing industry’s health.

Also Thursday, Australia is to publish government data on building approvals, a leading gauge of future construction activity, as well as official data on private sector credit and retail sales, the primary gauge of consumer spending.

Japan is to publish government data on average cash earnings and housing starts. Later in the day, the country is to publish its Tankan manufacturing and non-manufacturing indexes, leading indicators of economic health and the tertiary industry activity index.
 
Elsewhere, New Zealand is to publish a report on business confidence, a leading indicator of economic health, while Canada is to publish official data on GDP, the primary gauge of the economy’s health.

Friday

The U.S. is to round up the week with a string of data, including a closely watched report on non-farm payrolls, a leading indicator of job creation. The country is also to publish government data on the rate of unemployment and average hourly earnings.

In addition, the country is to release official data on construction spending and total vehicle sales, while the Institute for Supply Management is to publish a report on manufacturing activity.

Meanwhile, the euro zone is to release final data on manufacturing activity as well as a report on its unemployment rate, while the U.K. is to release official data on manufacturing activity.
 
Elsewhere, Switzerland is to publish official data on retail sales as well as a report on manufacturing sector activity, a leading indicator of economic health.

Also Friday, Australia is to publish government data on commodity prices, a key indicator as commodities account for over half of the country’s export earnings.