Ready to step up your day trading game in the second half of August?
We’ve got a busy week ahead with the Fed printing its meeting minutes, the RBNZ dropping its latest policy decision, and China and the U.K. releasing closely-watched economic reports!
Before all that, ICYMI, I’ve written a quick recap of the market themes that pushed currency pairs around last week. Check it!
And now for the closely-watched economic indicators on the calendar this week:
China’s Data Dump
We know from previous economic releases that China is seeing lower prices mostly because of decreased demand. On August 15 at 2:00 am GMT, we’ll see if investors have more reasons to be concerned about the world’s second-largest economy.
China will print its industrial production, retail sales, fixed asset investment, and unemployment rate reports. In addition to that, the National Bureau of Statistics will conduct a quarterly presser which may attempt to explain some of the trends in the reports.
China is currently expected to post improvements to industrial production and retail sales numbers. Investors will also keep tabs on fixed investment and housing prices amid threats to the financial stability of property developers.
Will the numbers disappoint enough to warrant some kind of stimulus announcement from the government this time?
U.K.’s Labor Market Reports
The latest Bank of England (BOE) statements hint that members are closely watching services inflation and wage growth, so you can bet that tons of traders will be keeping close tabs on this week’s labor market data.
On August 15 at 6:00 am GMT, the number of people claiming unemployment-related benefits is expected to decline by a net of 30,000 in July after rising by 25,700 in June. This might contribute to the 3-month average wage growth rising from 6.9% to 7.1% even while the July unemployment rate stays at 4.0%.
An upside surprise in wage growth trends could keep further BOE rate hikes on the table in the next meetings, so make sure you’re around during the release!
RBNZ’s monetary policy decision
If you’ve read our RBNZ Statement Event Guide, then you’ll know that the Reserve Bank of New Zealand (RBNZ) is expected to hold its interest rates at 5.50% in August.
On August 16, 2:00 am GMT, we could also see the central bank maintain its hawkish bias by turning data-dependent and keeping its next meetings “alive” for a potential rate hike.
Watch the statement and the presser closely to see if there’s reason for NZD traders to reprice their “hawkish hold” expectations!
U.K.’s Inflation
With household energy bills dropping sharply and food inflation easing in July, markets expect to see a significant dip in the U.K.’s headline inflation in August.
Monthly headline CPI could see a 0.3% decline after a 0.1% uptick in July. Monthly core inflation is expected to stay at 0.2%, however. Meanwhile, base year adjustments could drag annual headline CPI from 7.9% to 6.9% and take the annual core inflation from 6.9% to 6.8%.
Watch the newswires on August 16 at 6:00 am GMT to see if there are any surprises to inspire volatility among GBP pairs. Weaker inflation numbers would point to the BOE having room to tighten its policies and likely push GBP higher, especially after a strong GDP print last week.
FOMC meeting minutes
Back in late July, Fed members raised their interest rates by 25 bps to the 5.25% to 5.50% range. More importantly, the gang has decided to not telegraph its next rate hike. Gov. Powell said that they’ll consider interest rates on a meeting-by-meeting basis and keep each decision month “alive.”
Since then, some Fed members have suggested that they’ve done enough to lead inflation trends in the right direction even as some members remain hawkish. On August 16 at 6:00 pm GMT, we could get more insight into the Fed’s plans for the rest of the year.
Look out for hints of more than one rate hike or any hints of “peak” interest rates as these could cause extra volatility for USD pairs.
