James Trescothick

With more than 20 years of experience in financial service industry, James is our Senior Global Strategist and the co-producer and presenter of easyMarkets educational videos. When he is not working on educational programs or preparing webinars, you can find him with the easyMarkets team giving seminars around the world.

Welcome to the weekly outlook starting this Monday 30 October. We’ll be looking at the week’s key economic events on the financial calendar covering Monday to Thursday. This week we see a lot of news out of the US with particular attention paid to the key interest rate decision on Wednesday. More central bank rate decisions are expected from Japan and the UK. Meanwhile Europe releases GDP and inflation data, and we get jobs numbers out of NZ.

 

Event: US Core Personal Consumption Expenditures (September)

Date: Monday 30 October 2017 at 12:30 GMT

Markets affected: EUR/USD, USD/JPY

Trending hashtags: #usd

 

With the economy back on track and the US dollar up against most of its counterparts. The world’s largest economy is looking very robust following Friday’s GDP result beating expectations as the economy expanded 3% in the third quarter. The question to be seen this Monday is whether that has translated to personal consumption expenditure for US citizens. Previous reading of Personal Consumption Expenditure showed a 0.2% monthly increase with a 1.4% rise against the previous year. Core Personal Consumption Expenditure rose 0.1% on a monthly basis and 1.3% on an annualised basis. Also, due on Monday are personal income figures which are expected to rise 0.4% from the previous change of 0.2% in September.

 

Event: Bank of Japan Interest Rate Decision

Date: Tuesday 31 October 2017 at 02:00 GMT

Markets affected: EUR/JPY, USD/JPY

Trending hashtags: #jpy, #yen, #interestrate

 

The Bank of Japan has maintained its super low negative interest rate at -0.1% and it is not anticipated to change at this time. The rate decision will come just after unemployment data which will be released on the evening before at 23:30 GMT, which last month sat at 2.8%. Following the interest rate decision, the BOJ will hold a press conference at 6:30 GMT that investors in the yen will be closely following.

 

Event: EU Gross Domestic Product (Q3)

Date: Tuesday 31 October 2017 at 10:00 GMT

Markets affected: EUR/USD, EUR/GBP

Trending hashtags: #eur, #gdp

 

The European Central Bank indicated its confidence in the region’s economy last week by announcing cuts to quantitative easing starting in January next year. In the second quarter of this year the Eurozone GDP grew 2.3%, a 0.6% improvement from the first quarter reading. The expectation for the preliminary reading for Q3 is for GDP to fall back to 2%.

 

Event: EU Consumer Price Index (October)

Date: Tuesday 31 October 2017 at 10:00 GMT

Markets affected: EUR/USD, EUR/GBP

Trending hashtags: #eur, #gdp

 

September’s Consumer Price Index came in at 1.5% year on year change with core CPI growing 1.3% on a yearly basis. This is a key inflation indicator which will be closely followed by the markets as the ECB plans to continue with its stimulus programme for another nine months at least.

 

Event: New Zealand Unemployment (September)

Date: Tuesday 31 October at 21:45 GMT

Markets affected: NZD/USD, AUD/NZD

Trending hashtags: #nzd, #jobs

 

NZ unemployment came in previously at 4.8% for the year with an employment change of -0.2% last month. The employment participation rate is sitting at 70% which is the total number of people in the labour force – either in work or looking for work. Since the new government was voted in a little over a week ago the kiwi dollar has been jittery around economic indicators. Last week’s disappointing trade data saw the NZD lose some ground.

 

Event: US ISM Manufacturing PMI (October)

Date: Wednesday 1 November 2017 at 14:00 GMT

Markets affected: EUR/USD, USD/JPY

Trending hashtags: #usd, #ism

 

The key ISM Manufacturing PMI is due out in the US on Wednesday. The previous reading was 60.8 and expectations are for a slight drop in October to 59.0. ISM Prices Paid are also due out and this is a measure of business sentiment on future inflation, the previous reading came in at 71.5.

 

Event: US Fed Interest Rate Decision

Date: Wednesday 1 November 2017 at 18:00 GMT

Markets affected: EUR/USD, USD/JPY

Trending hashtags: #usd, #interestrate

 

Whenever the Federal Reserve makes an announcement the markets tend to sit up and pay attention. So even though most are not expecting the Fed to make changes to the current 1.25% interest rate at this time, there will be focus on rhetoric about one more rate hike before the year ends.

 

Event: UK Bank of England Interest Rate Decision

Date: Thursday 02 November 2017 at 12:00 GMT

Markets affected: GBP/USD, EUR/GBP

Trending hashtags: #gbp, # interestrate

 

Rounding off the week of key central bank decisions on monetary policy, is the Bank of England’s interest rate decision. At their last meeting, the BOE members voted to maintain the low 0.25% interest rate, some of the committee noted that it may be time to reduce monetary stimulus procedures. The high inflation in the UK is certainly adding weight to those member’s votes.

 

 

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