Weekly Outlook: Oct 05 - Oct 10

The coming week will also be pretty crowded with economic data, following the previous Non-Farm Payrolls week. The NFP report for September was a big disappointment for the U.S. dollar bulls and the economists that expected a rate hike in 2015. After the worse than expected employment data, the Fed policymakers seem to hold back the initial rate hike for 2016. The U.S. economy added just 142k below the optimistic forecast of 203k, even below the previous month’s number of 173k that revised down to 136k. Despite that the jobless rate remained steady at 5.1%, the wage growth came out 0.0% leaving behind the forecasts that wages have grown by 0.2%!

This week encloses three policy meetings of major central banks. The Reserve Bank of Australia, Bank of Japan and Bank of England will revise its interest rates. A speech by the European Central Bank President Mario Draghi is an important market-affecting event scheduled in the week, as well as the publication of the FOMC Minutes and the NIESR GDP release in UK. In Canada, the employment report at the end of the week followed by the speech of Bank of Canada Governor Stephen Poloz will attract traders’ interest.

[B]Today[/B], further to the beginning of the two-day Eurogroup meeting, is a Markit PMI day. The final Markit Services and Composite PMIs figures for September coming out from U.S., Eurozone as a whole, Germany, UK, France and Italy. In Eurozone, the Sentix Investor Confidence for October and the Retail Sales for August will be eyed. In US, slightly after the Markit PMIs, the ISM Non-Manufacturing PMI and the Labour Market Conditions Index for September will be out.

Later in the day, in New Zealand, the NZIER Business Confidence for the third quarter will be released. In Australia, the AiG Performance of Construction Index for September will attract considerable attention. During the night, Reserve Bank of Australia will have its policy meeting and will publish its interest rate decision along with its rate statement.

On [B]Tuesday[/B], an EcoFin meeting will take place. Beyond that, the only market driver event of the day is the speech from the ECB president Mario Draghi at the afternoon. Early in the morning, Germany’s Factory Orders for August will be out. In Switzerland, September’s inflation rate will be announced. In US, the Trade balance for August will also be out as well as the IBD/TIPP Economic Optimism for October. Canada’s Ivey Purchasing Managers Index for August will be out. Overnight, Bank of Japan will release its Monetary Policy Statement, followed from a press conference that explains their decision.

Early on [B]Wednesday[/B], German Industrial Production will be out. In Eurozone, non-monetary ECB policy meeting will take place in the morning. In UK, the Manufacturing and Industrial Production for August will be eyed. Traders will also watch closely the NIESR GDP Estimate for the three months to September (Jul - Aug – Sep). Later in the day, in Japan, Machinery Orders for August will be released.

[B]Thursday [/B]encloses important economic news! Early in the morning, Japanese consumer confidence index and Bank of Japan monthly economic survey will be published. Later in the morning, market’s attention will turn in UK where the Bank of England Monetary Policy Committee will vote for its interest rate. The market expects one member of the committee to vote for an interest rate hike while the other eight are expected to vote for leaving interest rates unchanged. The BoE minutes and the monetary policy statement will be eyed to details to decipher probable hawkish comments.

The European Central Bank will publish its Monetary Policy meeting accounts. Going forward, in US, the FOMC minutes will be scrutinized by traders for explanations what kept back the Fed policy members to vote for an interest rate hike in September’s policy meeting. However, after the latest NFP report vital data changed that cancel out earlier hawkish thoughts of the policymakers for a rate hike in the upcoming policy meeting or later in 2015.

On [B]Friday[/B], The International Monetary Fund will begin its meeting. In Norway, the inflation rate for September will be out. In UK, Goods trade balance for August will be eyed. August’s wholesale inventories from U.S will be released. The CAD traders will keep a tab on Canada’s employment report for September. The unemployment rate is forecasted to have slowed down to 6.9% from 7.0% before while the Canadian economy is expected to have added 10,000 jobs in September vs 12,000 the previous month. On Saturday afternoon, Bank of Canada Stephen Poloz will have a speech and he is expected to comment on the Employment report will be released the day before.