A busy central bank week examined

Frank Walbaum FX Strategies.Asia

Important news for the week

Tue, 17th, 14:30 CET CA Consumer prices index.
Wed, 18th, 08:00 CET UK Consumer prices index.
Wed, 18th, 20:00 CET US Fed interest rate decision.
Thu, 19th, 13:00 CET UK BoE Interest rate decision.
Fri, 20th JP BoJ interest rate decision.

Central bank week

During this week major central banks are due to decide upon their interest rates. Starting with the Fed on Wednesday it is expected that the interest rate will be cut. Jerome Powell pointed out several times in the past that a step might be due this month. On the other hand it is not expected that the BoE will reduce rates during this meeting. Instead more members of the committee might move towards a rather hawkinsh side, causing no action to be done. On Friday the Bank of Japan will also gather and might offer a surprise rate hike. The Central Bank governor Ueda had stated recently that further rate hikes might follow. The JPY is hence gearing up steam.

Market talk

The Dollar is starting much weaker into this week. Will this be a preview of what might be expected from the Fed? Risk assets are hence gearing up steam with not only equities running higher but also precious metals continue to strengthen due to the weaker Greenback. Also the price of oil keeps rising as the recent support zone seemingly has been defended. This week will be exciting but should also be traded with caution due to the many central bank news ahead.

Tendencies in the markets

Equities positive, USD weak, cryptos sideways, oil stronger, metals positive, JPY stronger.

Author

Frank Walbaum

FX Strategies.Asia

Frank has been working in the TV business for several years. Acquiring his skills in Germany’s biggest broadcasting station, he then chose to work and live in Asia, which was in 2007.

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