Weekly Forex Market Analysis (23-27 September)
As we look ahead to the upcoming week in the forex market, there are several key events and data releases that traders should keep an eye on. From flash PMIs to central bank policy decisions, here is a comprehensive analysis of what to expect in the forex market from 23-27 September.
Monday: Flash PMIs Day
Monday marks the beginning of the trading week, with Japan on holiday and a slew of flash PMI releases scheduled for Australia, the Eurozone, the UK, and the US. These Purchasing Managers’ Index (PMI) reports provide valuable insights into the health of the manufacturing and services sectors in each respective economy.
In the Eurozone, the Manufacturing PMI is expected to come in at 45.6, slightly lower than the previous reading of 45.8. Meanwhile, the Services PMI is forecasted to be 52.1, down from the previous figure of 52.9.
In the UK, both the Manufacturing PMI and Services PMI are expected to show slight declines, with readings of 52.5 and 53.5, respectively.
For the US, the Manufacturing PMI is forecasted at 48.5, up from the previous reading of 47.9, while the Services PMI is expected to come in at 55.3, a slight decrease from the previous figure of 55.7.
Tuesday: RBA Policy Decision and US Consumer Confidence
On Tuesday, the Reserve Bank of Australia (RBA) will announce its policy decision, with expectations that the Cash Rate will remain unchanged at 4.35%. The RBA has maintained a hawkish stance amid high inflation, with market participants anticipating the first rate cut in February 2025.
In the US, the Consumer Confidence report is expected to show a reading of 103.8, slightly higher than the previous figure of 103.3. Consumer sentiment plays a crucial role in shaping economic growth and spending patterns, making this release an important indicator for forex traders.
Wednesday: Australian Monthly CPI
Wednesday brings the release of the Australian Monthly Consumer Price Index (CPI), with expectations for a year-on-year growth rate of 3.1%, down from the previous reading of 3.5%. RBA Governor Bullock has emphasized the importance of monitoring multiple inflation reports to gauge the trajectory of price levels, suggesting that this release may not have a significant impact on monetary policy decisions.
Thursday: SNB Policy Decision and US Jobless Claims
The Swiss National Bank (SNB) is expected to announce a 25 basis point rate cut on Thursday, bringing the policy rate to 1.00%. There is a 45% probability of a larger 50 basis point cut, driven by lower-than-expected inflation and concerns about the strength of the Swiss Franc.
In the US, Jobless Claims data will be released, providing insights into the state of the labor market. Initial Claims are expected to come in at 225K, while Continuing Claims are anticipated to show improvement following a recent uptick.
Friday: Tokyo Core CPI and US PCE
Friday’s highlights include the release of Tokyo Core Consumer Price Index (CPI) and the US Personal Consumption Expenditures (PCE) data. The Tokyo Core CPI is expected to show a year-on-year growth rate of 2.0%, while the US PCE is forecasted to come in at 2.3%.
The Tokyo CPI is considered a leading indicator for national inflation trends, making it a closely watched release for forex traders. Meanwhile, the US PCE data provides insights into consumer spending patterns and inflationary pressures, influencing the Federal Reserve’s monetary policy decisions.
In conclusion, the upcoming week in the forex market is packed with important events and data releases that have the potential to move currency pairs. Traders should stay informed and be prepared to react to any surprises in the economic data.
