US third quarter GDP preview

Today flash estimate of US third quarter GDP will be released at 12:30 GMT.

After relatively hawkish policy statement from FOMC, GDP figure stands vital in determining Dollar's next move.

Past trends

• US GDP picked up pace since 2013 and increased pace in 2014. However after rising 5% and 2.2% in previous two quarters, US GDP shrank by -0.1% in the first quarter of 2015. Historically speaking US economy usually falters in first quarter.
• However second quarter was relatively better, with GDP growing at 2.1% in second quarter from the first.

Expectation today

• Market is expecting GDP to grow at least 1.5% on quarterly basis and at annualized rate of 1.6%. However data could surprise to the upside, given third quarter historically has been a strong one.

Market impact

• Expect Dollar to gain if data surprises to upside. More so because, FED is still expecting to hike policy this year, according to latest policy statement yesterday. Stronger data might boost equities, especially in US as growth fear would subside.
• Weaker data is likely to derail Dollar, however large shift is unlikely given hawkish comments from FED.

FXCM Dollar index is currently trading at 12090, down -0.2% so far today.