Analysts at ING noted that the week ahead is a 'BIG' one.
Key Quotes:
"Vollgeld: Our response to Martin Wolf
This week, Financial Times commentator Martin Wolf argued that the Swiss should vote in favour of Vollgeld- a plan to fundamentally change the way money is created. We believe this is a risky experiment."
"G7 Summit: Trump needs to back off to secure his wins
So far President Trump's 'maximum pressure' strategy has worked, but the results are now at risk because China has threatened to take back concessions and the EU, Canada and Mexico have also announced retaliatory measures. At the G7 summit, this Friday President Trump will be pressured to scale down his demands to preserve his gains thus far."
"Federal Reserve preview: Stepping on the gas
A rebound in US growth and rising inflation pressures mean the Fed will concentrate on domestic issues rather than be distracted by emerging market woes at the forthcoming meeting."
"Brexit update: Theresa May’s biggest test yet?
The UK Prime Minister faces a series of challenging parliamentary votes on her plan to leave the customs union and single market after Brexit."
"ECB preview: Praet’s pivot pirouette
Despite growing uncertainties around the strength of the eurozone recovery, little underlying inflationary pressure and possible further market turmoil, the ECB seems determined to demonstrate its focus on long-term trends. After Praet's remarkable speech, we expect a very exciting meeting on 14 June."
"China: Why the central bank won’t cut reserve requirements
China's central bank is supporting the onshore bond market by expanding collateral for the medium-term lending facility (MLF). This will reduce contagion risks though standalone default cases could continue. Still, we think it's unlikely the central bank will cut its reserve requirements ratio (RRR) for banks in June."
"US housing: Still going strong but for how long?
A mixed month for US housing data, but the overall direction remains upwards. The question is, how long will this trend continue?"
"Copper back above $7k as the curve flirts with backwardation
The start of labour negotiations at the world’s largest copper mine, Escondida, have restored volatility to the copper market. We are keeping a close eye on the tightening spreads which could restore fund flows but also seem dependent on stock holdings."
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EUR/USD stays below 1.1100, looks to post weekly losses
EUR/USD continues to trade in a narrow range below 1.1100 and remains on track to end the week in negative territory. Earlier in the day, monthly PCE inflation data from the US came in line with the market expectation, failing to trigger a reaction.
GBP/USD struggles to find a foothold, trades near 1.3150
GBP/USD stays on the back foot and trades in negative territory at around 1.3150 on Friday. The US Dollar holds its ground following the July PCE inflation data and doesn't allow the pair to stage a rebound heading into the weekend.
Gold retreats toward $2,500 ahead of the weekend
Gold stays under modest bearish pressure and declines toward $2,500 in the American session on Friday. The 10-year US Treasury bond yield edges higher toward 3.9% after US PCE inflation data, causing XAU/USD to stretch lower.
Week ahead – Investors brace for NFP amid Fed rate cut speculation
Here comes another NFP week, with investors eagerly awaiting the results as they try to discern the size and pace of the Fed’s forthcoming rate cuts. The weaker than expected July numbers triggered market turbulence, instilling fears about a potential recession in the US.
Easing Eurozone inflation to back an ECB rate cut in September Premium
Eurostat will publish the preliminary estimate of the August Eurozone Harmonized Index of Consumer Prices on Friday, and the anticipated outcome will back up the case for another European Central Bank interest rate cut when policymakers meet in September.
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