It was a volatile week dominated by central bank updates, and traders are expecting to see some moves in the days ahead, despite the Christmas holidays falling in the middle of the trading week.
With many significant trading centers having multiple days off this week and trading desks likely to be short-staffed, most investors anticipate range-bound conditions as we move through the week. However, a couple of potential banana skins remain on the calendar, along with the usual threat of geopolitical risks in thin liquidity conditions.
Here is our usual day-by-day breakdown of the major risk events this week:
There is nothing scheduled on the calendar to kick off the week in the Asian session on Monday, and it’s a similar story for the European day. However, sterling traders will keep a close eye on the Bank of England’s Quarterly Bulletin when it’s released. One of the key data updates of the week comes shortly after the New York open, with Canadian GDP data due, followed later in the session by the U.S. CB Consumer Confidence Data release.
A couple of key updates are scheduled for Christmas Eve. The initial focus during the Asian session will be on Australian markets, with the RBA’s Monetary Policy Meeting Minutes due midway through the morning. There is nothing of note in the European session, although traders will observe that the holiday starts early today with German markets closed. During the U.S. session, the release of U.S. Durable Goods data, New Home Sales, and the Richmond Manufacturing Index numbers is scheduled.
Christmas Day sees the majority of major trading centers closed, with liquidity massively reduced in those markets that remain open. However, there is potential for some big moves in the yen, as Japanese markets will be open and Bank of Japan Governor Kazuo Ueda is scheduled to speak during the day.
Once again, most major markets are closed for Boxing Day holidays. However, FX players will be aware that the market will continue to trade, and there remains the possibility of sharp moves in the reduced liquidity. U.S. markets will reopen today, with weekly unemployment claims and oil inventory numbers due for release during the session.
Most markets will technically be back in full operation on Friday, although poor liquidity conditions are still expected. Japanese markets will be in focus early in the day, with the release of the Tokyo CPI data scheduled. There is little else of note on the calendar during the later sessions, but traders will remain vigilant for any sharp moves due to geopolitical updates in the thin trading conditions.
