The dollar is still on the back foot Monday after dovish comments from Federal Reserve Chairman Powell on Friday. The lack of data events and a NAFTA deal are keeping propelling the greenback’s weakness.

NAFTA deal dips dollar

Already experiencing weakness across the board, the dollar is down against its Canadian neighbor to the north after the U.S. and Mexico reach a deal to replace NAFTA.

President Trump said the new agreement with Mexico will not be named NAFTA. And Canada may be invited to join the deal or it could create its own deal with the U.S.

USD/CAD dropped from above 1.306 to 1.297 – its lowest level since the beginning of August.

EUR/USD has climbed up from 1.163 to 1.168 after the news and the dollar is still down against the pound.

For now, the markets are quiet with the U.K. on holiday, but a series of events later in the week and progression of trade talks, Turkey and Brexit will likely sway the pairs.

U.S. GDP and PCE Wednesday

Data picks back up on Wednesday with the U.S. Q2 GDP, which is expected to fall to 4.0% from 4.1%.

We’ll also see core personal consumption expenditures for the quarter, which are expected to remain at the same 2%. PCE numbers will get more specific on Thursday with the July numbers, which are also expected to remain steady for month-over-month and year-over-year growth.

If we see these numbers coming out higher than expected, we could see the dollar jumping.

CPI figures for Germany, Japan, Eurozone

The consumer price indexes for various countries are due this week, starting with Germany on Thursday.

The harmonized CPI for August is expected to slow to 2% growth year over year from 2.1% previously.

We’ll see how that contributes to the larger Eurozone CPI on Friday. Core CPI YoY is expected to stay at 2.1% growth for August.

In between those figures, Japan will release its CPI for the month of August. Core CPI is also expected to remain at 0.5% growth.

Eurozone and Japan unemployment

At the same time they release inflation data for August, Japan and the Eurozone will release unemployment figures for the month of July.

Both readings are expected to fall slightly. Japan’s unemployment rate was 2.4% in June and is expected to drop to 2.3% in July.

Unemployment for the Eurozone sits at 8.3% from June and is expected to be 8.2% for the July reading.

If the E.U. number fails to decline or increases, we could see the euro gaining on the dollar.