Market Opportunities : Week 31-07-2023 - 04-08-2023

USDCNH: China’s Manufacturing Purchasing Managers' Index (PMI) report for July is an important event for forex markets due July 31. The performance of China’s economy is an important indicator of the state of global economy as China supplies manufactured goods to many countries of the world. The Chinese economy is experiencing deflationary pressures as indicated by China’s GDP growth slowing down to 0.8% over quarter in April-June from 2.2% in January-March. There is a possibility the Manufacturing PMI report may show weaker performance than expected which will be bullish for USDCNH.

GBPUSD: Bank of England (BOE) interest rate decision due on August 3 is the key economic event of July 31 – August 4 week. BOE surprised markets by raising interest rate 50 basis points at its last meeting and there is no consensus whether the central bank may pause rate hikes at current 5% rate or will raise rates farther. A BOE decision to raise rates at its August 3 meeting will be bullish for GBPUSD.