It was a massive week for financial markets last week, with major central bank rate calls, big US data, and trade updates all contributing to some big moves across products.
The week ahead certainly does not have as much scheduled on the macroeconomic calendar, but there are still some big data updates to come, and the Bank of England will be making a big interest rate call.
As well as those scheduled events, traders are anticipating more on the geopolitical front, and there are more big earnings reports to come, so volatility is expected to remain high in the coming days.
Here is our usual day-by-day breakdown of the major risk events this week:
There are bank holidays in both Australia and Canada on Monday, which could see some liquidity removed from the market for the first day of the week, and very little on the calendar apart from the key Swiss CPI data early in the London session.
Tuesday is also relatively quiet on the event calendar. The Bank of Japan Monetary Policy Meeting Minutes are out in the Asian session, and we have US ISM Services PMI data out in the New York day, but traders are expecting to see relatively smooth trading conditions across the sessions.
The main data update for Wednesday comes out very early in the day, with New Zealand employment numbers due out early in the Asian session. There is very little else scheduled across the rest of the trading day; however, we are due to hear from Fed members Daly, Collins, and Cook, and given recent updates on the FOMC, traders will be expecting some moves in US markets around the updates. The weekly US Crude Oil Inventory data drop is also scheduled during the New York session.
The busiest day of the week in terms of scheduled calendar events. Once again, Kiwi markets will be in focus during the Asian session with the latest quarterly Inflation Expectations data due out. The big event of the day – and indeed the week – comes midway through the London session, with the Bank of England expected to deliver a rate cut. The New York session sees the usual weekly Unemployment Claims data released, as well as the Canadian Ivey PMI numbers.
It is a quiet calendar day to close out the week, with nothing of note scheduled for release during the first two trading sessions of the day. Canadian markets will be in focus during the final session of the week, with employment data set for release, and traders will also note that key Chinese CPI and PPI numbers will be released on Saturday. Any big deviations from expectations can lead to some gapping on the Monday open.
