As can be seen the economic data is second rate and rare this week, however the week will not be without its opportunity for action since the USA, British and Japanese all have rate decisions to make.
Bar, controversially, the LME the UK will be pretty much closed for Queen Elizabeth’s state funeral on Monday so this maybe an opportunity for the remaining market to test the recent lows in GBPUSD. GBP and the Yen are the weakest of the majors with economic (and to some degree political ) worries and both have rate decisions to make. Expectations are that the Bank of Japan do nothing – although they are expressing unhappiness with the level of USDYEN indeed on Wednesday they rate-checked prices, the Bank of England is expected to raise 50bps and is not mandated to worry about FX levels but the drop in GBP is adding to the inflation fire as mainly products are priced in USD.
The Fed are expected to go 75bps in fact some commentators believe that 100bps is not impossible but they will have seen the dreadful Q1 figures from FEDEX and be aware that the US economy is starting to weaken so 75bps feels the most likely.
Even the European Deputy Governor said that that a weakening economic outlook is not going to curb inflation…
Commodities have seen some weakness on the back of potential global slowdown and China still placing restrictions on its citizens over Covid and its “zero policy”. But it does depend on supply for example fears of restrictions in aluminium production leave that market higher but the gas markets are lower.
OPEC+ seem to like an oil market between $85-105 so sustained movements outside of that range will be watched with interest as to OPEC+ response.
FOMC Rate decision
Bank of England rate decision
Initial Jobless Claims
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