This week, the markets will be focusing on a series of data sets with speeches by the chiefs of the Fed and BoE, interest rate decisions of central banks such as CBRT, RBNZ, and SNB, local elections in Italy, and EU meetings.
Bailey, Lagarde & Powell Speeches
US Federal Reserve Chairman Jay Powell will make statements Monday, Wednesday, and Thursday about the course of the economic recovery and Fed’s new inflation target policy amid the unprecedented economic collapse caused by the Covid19 pandemic.
Similarly, on the first day of the week, European Central Bank (ECB) President Christine Lagarde will speak.
Investors will be eager to tune into a speech by the Bank of England (BoE) Governor Andrew Bailey as he speaks to a videoconference call of the British Chambers of Commerce on Tuesday.
More clarity will be sought about the bank’s stance on bringing interest rates below zero from Bailey’s comments. Bailey will also speak on Thursday.
The pound fell last week after markets saw signs that the BoE might seriously consider further lowering rates, and UK government bond prices rose.
RBNZ, SNB, CBRT meetings & BoJ announcement
The Central Bank of New Zealand (RBNZ) and the Swiss National Bank (SNB) will hold their monetary policy meetings on Wednesday. No change in rates is expected from either bank.
The Bank of Japan (BoJ) will make a monetary policy announcement the same day.
The Central Bank of the Republic of Turkey (CBRT) is holding its September monetary policy meeting on Thursday. The bank is expected to keep its one-week repo interest rate at 8.25 percent at a time the lira is persistently tumbling to record low levels.
UK Covid-19 Restrictions
With up to a fifth of the UK already under tighter local health restrictions, Secretary of State for Health Matt Hancock warned over the weekend that the country was at a “tipping point” in the fight against the Covid19, saying that new national restrictions might be needed to contain the virus.
As Prime Minister Boris Johnson announced fines of up to £10,000 for those who break isolation rules, London mayor Sadiq Khan alarmed the capital for further restrictions.
Local elections are held in Italy, one of the chronically troubled southern economies of the Eurozone.
The elections which began on Monday and continue on Tuesday, the ruling Democratic Party (PD) fears losing control of Tuscany, one of the strongholds of the Italian left, to Matteo Salvini’s anti-immigrant and northern separatist Lega Nord party.
There is also a referendum on a plan to reduce the number of MPs from 945 to 600 in the next election. The public is expected to support this reform, although many lawmakers campaign for the status quo.
The European Commission President Ursula von der Leyen is set to announce a new agreement on immigration and asylum on Wednesday.
EU leaders are also holding a summit in Brussels on Thursday to discuss the bloc’s relations with Turkey, Belarus, and China.
UN General Assembly
World leaders will meet online for the 75th session of the UN General Assembly on Wednesday to discuss how to tackle the coronavirus.
Ifo Institute’s surveys from Germany are to be published on Thursday.
PMI data from the Eurozone, Germany, France, and the UK are to be watched on Wednesday.
US jobless claims to be announced on Thursday are expected to have fallen from 860,000 recorded the previous week to 845,000 in the week ending September 14.
Monday: Japan - Respect for the Elderly Day, ECB President Lagarde Speaks, US Fed Chair Powell Speaks
Tuesday: Japan - Autumn Equinox, RBNZ Rate Statement, BoE Gov Bailey Speaks, US Existing Home Sales, US Fed Chair Powell Testifies
Wednesday: RBNZ Interest Rate Decision, German Manufacturing PMI, UK Composite PMI, UK Manufacturing PMI, UK Services PMI, BoJ Monetary Policy Statement, US Fed Chair Powell Testifies, US Crude Oil Inventories
Thursday: SNB Interest Rate Decision, SNB Monetary Policy Assessment, German Ifo Business Climate Index, US Initial Jobless Claims, BoE Gov Bailey Speaks, US Fed Chair Powell Testifies, US New Home Sale
Friday: Core Durable Goods Orders