It was a huge week for financial markets last week, with several central banks making key interest rate updates, including the Federal Reserve, while key data releases and geopolitical updates combined to see volatility rise to near annual highs again.
Once again, it looks like being a busy week ahead for traders. Central bank interest rate decisions continue, with both the RBA and BoE making calls, while the US midterm election results will add to the volatility, alongside the key Non-Farm Payroll numbers at the end of the week.
On top of the fundamental updates, any fresh news out of the Middle East is likely to keep oil and energy markets in focus, with hostilities now seeming to escalate on an almost daily basis.
Here is our usual day-by-day breakdown of the major risk events this week:
It is a quiet start to the week on Monday, with little on the calendar across all three trading sessions. US ISM Manufacturing PMI will draw some attention early in the New York session; however, traders are expecting geopolitics to dominate for most of the day.
Things start to heat up on the economic calendar on Tuesday. The Asian session will see a strong focus on Australian markets, with the RBA set to make its latest rate call. A 25-basis-point hike looks to be almost a certainty. Swiss CPI data is due out early in the London session; however, the US session is likely to be the busiest, with the key midterm elections taking place, as well as the first US jobs number of the week, the JOLTS Job Openings data, being released. We also hear from Bank of Canada Governor Tiff Macklem later in the day.
The Asian session will see an early focus on New Zealand markets, with the latest employment data due out, while the London session features the EU Flash CPI data shortly after the open. The US day should see the results of the midterms confirmed, as well as the latest ISM Services PMI data and the weekly Crude Oil Inventory numbers.
It is a quieter Asian session on Thursday, but UK markets will be a strong focus in the London session, with the Bank of England set to make its latest interest rate call. The New York session sees the release of the weekly unemployment claims numbers, as well as another scheduled testimony from Bank of Canada Governor Tiff Macklem when he speaks in Ottawa.
It is Non-Farm Payrolls day on Friday, and all the action is reserved for the final session of the day. The key US employment data is due out early in the day, alongside Canadian employment figures. Canadian Ivey PMI data is also due out later in the day, along with the Preliminary University of Michigan data; however, as always, the US employment data is likely to dominate sentiment into the weekend.
