A Week in the Market: The Fed and the Employment Market (30 October - 3 November)
2 minutes for reading
This week is marked by the actions of central banks, with the major ones assessing the economic situation and deciding on interest rates. This will likely increase stock market volatility, keeping investors engaged.
USD: the US is the main newsmaker
The US Federal Reserve is expected to keep the interest rate unchanged and release employment market data for October. Volatility in the EUR/USD pair will notably increase starting Wednesday. The USD still appears quite strong.
China: risk needs support
China is set to release services and manufacturing PMIs for October. More robust statistics bode well for risk-related assets.
EUR: underwhelming news
The eurozone is preparing to publish the revised GDP parameters for Q3. The economy is expected to grow by 0.2% year-over-year, not the previously believed 0.5%. This does not bode well for the EUR exchange rate.
JPY: battling devaluation
The Bank of Japan will likely leave the interest rate at -0.1% per annum but may raise its inflation forecasts. There is a low likelihood that this will save the yen from a new wave of upcoming devaluation, but it will create conditions for a pause.
GBP: potential negativity
The Bank of England will likely keep the interest rate at 5.25% annually. In addition, the regulator is set to release a monetary policy report and minutes of the previous meeting. The central bank's neutral stance may harm the GBP.