Central banks take centre stage, with the Fed and the Bank of England delivering interest rate decisions.
US consumer confidence and the US Jobs Report will impact investor bets on a March Fed rate cut.
The Eurozone economic calendar and private sector numbers from China also need consideration.
For the US, Consumer Confidence and JOLTs Job Openings will likely influence the USD on Tuesday. Strong consumer confidence and an upward trend in job openings could reduce bets on a March Fed rate cut.
On Wednesday, ADP employment figures for January warrant investor interest ahead of the Fed interest rate decision. The US labour market remains a focal point for the Fed. Tight labour market conditions support wage growth and disposable income. Upward disposable income trends fuel consumer spending and demand-driven inflation.
However, the Fed interest rate decision, Rate Statement, and Press Conference will be the main event. Economists expect the Fed to leave interest rates at 5.50%, putting the focus on the Rate Statement and Press Conference.
On Thursday, US jobless claims, nonfarm productivity, and unit labour costs need consideration. Softer labour market conditions could influence bets on a March Fed rate cut. Other stats include ISM Manufacturing PMI numbers. However, barring a slump in manufacturing sector activity, the numbers will likely play second fiddle to the labour market data.
On Friday, the US Jobs Report will wrap up a busy week for the US dollar. Wage growth, nonfarm payrolls, and the US unemployment rate will influence bets on a March Fed rate cut.
Other stats include finalized Michigan Consumer Sentiment numbers for January. Revisions to preliminary numbers and inflation expectation numbers also need consideration.
The Bank of England interest rate decision is the main event on Wednesday.
Economists expect the BoE to leave interest rates at 5.25% on Thursday. A hold on interest rates would put the focus on the MPC Meeting Minutes and BoE Governor Andrew Bailey.
Governor Bailey will speak later in the Thursday session. In December, two MPC members voted for a rate hike. A hawkish BoE would drive buyer demand for the Pound.
On Friday, BoE Chief Economist Huw Pill will close out a busy week for the Pound.
Other stats include finalized Manufacturing PMI numbers for January (Thurs). However, the markets will likely brush aside the numbers, with the BoE in the spotlight.
On Wednesday, GDP numbers for November will provide direction to the Loonie.
A pickup in economic activity could delay Bank of Canada plans to cut interest rates.
Last week, the Bank of Canada left interest rates at 5.25%.
02.30 – Australia – CPI q/q, CPI y/y, Trimmed Mean CPI q/q
Potential instruments to Trade: AUD Crosses.
03.30 – China – Manufacturing PMI
Potential instruments to Trade: CNY Crosses.
All-Day – Europe – German Prelim CPI m/m
Potential instruments to Trade: EUR Crosses.
15.15 – US – ADP Non-Farm Employment Change
Potential instruments to Trade: USD Crosses.
15.30 – Canada – GDP m/m
Potential instruments to Trade: CAD Crosses.
15.30 – US – Employment Cost Index q/q
Potential instruments to Trade: USD Crosses.
16.45 – US – Chicago PMI
Potential instruments to Trade: USD Crosses.
21.00 – US – Federal Funds Rate, FOMC Statement
Potential instruments to Trade: USD Crosses.
21.30 – US – FOMC Press Conference
Potential instruments to Trade: USD Crosses.
Thursday 1st February
14.00 – UK – BoE Monetary Policy Report, Monetary Policy Summary, MPC Official Bank Rate Votes, Official Bank Rate
Potential instruments to Trade: GBP Crosses.
15.30 – US – Unemployment Claims
Potential instruments to Trade: USD Crosses.
17.00 – US – ISM Manufacturing PMI
Potential instruments to Trade: USD Crosses.
Friday 2nd February
15.30 – US – Average Hourly Earnings m/m, Non-Farm Employment Change, Unemployment Rate
Potential instruments to Trade: USD Crosses.
17.00 – US – Revised UoM Consumer Sentiment
Potential instruments to Trade: USD Crosses.
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