US Dollar

On Monday, August 5, the U.S. ISM Services PMI data will influence the demand for the U.S. dollar. If the PMI unexpectedly falls, it could raise fears of a hard landing for the US economy, as the services sector accounts for more than 70% of the US economy.

On Thursday, August 8, the focus will turn to the U.S. labor market. Higher-than-expected continuing unemployment claims could increase market bets on multiple Fed rate cuts in 2024.

Weak labor market conditions could impact wage growth, which could reduce disposable income. A downward trend in disposable income could dampen consumer spending and demand-driven inflation.

In addition to the data, investors should also pay attention to comments from members of the Federal Open Market Committee (FOMC). Views on the economy and the path of the Fed's interest rates could influence the market.FOMC members Mary Daly (Monday) and Thomas Barkin (Friday) will speak.

Euro

On Monday, Eurozone services PMIs will influence EURUSD demand. PMI downgrades in Germany and the Eurozone could increase investor bets that the ECB will cut interest rates in September. In addition to PMI data, sub-components such as prices and employment also need to be considered.

On Tuesday, August 6, German factory orders will be of interest to investors. Recent German economic indicators have sparked fears of a recession. A further decline in orders could force the ECB to consider multiple rate cuts in 2024.

On Wednesday, August 7, German industrial production and trade data will be in focus. A continued decline in industrial production and deteriorating terms of trade could indicate further weakness in demand. A weaker demand environment could support a more dovish ECB rate path.

Other data include final German inflation data due on Friday, August 9th. However, unless there are revisions to the preliminary data, these are unlikely to impact EURUSD demand.

In addition to the data, comments from ECB members also need to be considered. Views on inflation, the economic outlook and the timing of interest rate cuts will influence demand for the Euro.

Pound

On Monday, final data from the UK Services PMI will impact demand for Sterling.A downgrade in the PMI could spark speculation of a rate cut from the Bank of England in Q4 2024, as the services sector accounts for over 70% of the UK economy.

In addition, investors should also consider employment and prices, among others. Weak labor market conditions could dampen wage growth and consumer spending, which could impact demand-driven inflation.

On Tuesday, the UK Retail Sales Monitor will be in focus. A further decline in retail sales could spark speculation of a recession in the UK. Private consumption accounts for more than 60% of the UK economy.

Canadian Dollar

On Tuesday, Canadian trade data will be in focus. A higher-than-expected trade deficit could indicate a weak demand environment and support a more dovish Bank of Canada rate path. Investors should also consider import and export trends.

On Thursday, the Bank of Canada minutes will be of interest to investors. Hints of further rate cuts could reduce market demand for the Canadian dollar.

On Friday, Canadian employment data will be crucial. An unexpected rise in the unemployment rate could spark speculation that the Bank of Canada will cut rates in September. A deteriorating labor market could affect wage growth and consumer spending.

Other data includes the Ivey PMI. in contrast, however, trade and employment data are likely to have a greater impact on demand for the Canadian dollar.

AUD

On Tuesday, the Australian Federal Reserve's rate decision and press conference will be in focus. An unexpected rate hike could increase market demand for the Australian dollar. However, a more dovish Australian Fed could weigh on the AUDUSD amid heightened global economic concerns.

At a press conference in June, Australian Fed Governor Michele Bullock said that board members discussed the rate hike.

The NAB business confidence data released on Thursday also needs to be considered. A drop in business confidence could indicate a decrease in spending and job creation. Reduced hiring could impact consumer spending and support a more dovish Aussie Fed rate path.

New Zealand Dollar

On Wednesday, labor market data will influence market demand for the New Zealand Dollar. A rise in New Zealand's unemployment rate could spark speculation of a rate cut by the Reserve Bank of New Zealand.

Japanese Yen

On Monday, final Japanese services PMI data will influence demand for the Japanese yen.An upward revision in the PMI could increase investor bets on a rate hike by the Bank of Japan in the fourth quarter of 2024. The BOJ expects the services sector to support the economy and drive demand-driven inflation.

However, Tuesday's average cash earnings and household spending could have a bigger impact on demand for the yen. Higher wages and household spending could drive consumer price inflation and support a more hawkish BOJ rate path.

Investors should also track the BOJ's comments following the rate hike and reduced purchases of Japanese government bonds. A hawkish view of the interest rate path could increase yen demand.

China

On Monday, China's Caixin Services PMI will be in focus. An unexpected decline in services activity could weigh on market risk sentiment.

On Thursday, trade data will also be of interest. Investors should consider import and export trends. Weakness in imports and exports would indicate a weak demand environment and could spark speculation of slower growth in the third quarter of 2024.

On Friday, China's inflation data will be released. Lower inflation data would also indicate weak demand and economic growth.

In addition to the data, investors should consider comments from Beijing. Speculation about a fiscal stimulus package could boost demand for risky assets.