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Risks Ahead: Tranquil Data Mixed with Loud Nervous Chatter

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Risks Ahead: Tranquil Data Mixed with Loud Nervous Chatter

Last Friday finished with stronger than expected Non-Farm Employment Change numbers, which essentially collided with dovish rhetoric via two U.S Federal Reserve FOMC members from the middle of the week; this while inflation clearly remains stubborn in the U.S.

All of which sets up this coming week for nervous trading results and until the 14th of June, when the Federal Reserve’s Federal Funds Rate pronouncements will be brought forth. Plenty of talk about interest rates will be heard in the days ahead and traders should expect to hear debates as the chatter grows louder.

Commodity traders may be interested in the outcome of the OPEC+ meetings taking place this weekend. The cartel’s decisions regarding oil production will affect not only prices of Crude Oil futures, but is a direct reflection regarding global demand, which also tells us about the organization’s viewpoints regarding global economic conditions.

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WTI Crude Oil Three Month Chart as of 4th of June 2023

Monday, the 5th of June, European Services PMI – Germany, France and Italy and will release their Purchasing Managers Index readings. The German outcome could prove interesting because the nation is suffering from recessionary pressures. The PMI results could affect the EUR/USD a bit. The U.K will also release their data too.

Monday, the 5th of June, U.S ISM Services PMI – this report will be of interest because some are expecting a better outcome compared to May’s results. A potentially strong reading could prove problematic and put more pressure on the Federal Reserve to raise interest rates next week.

Tuesday, the 6th of June, Australia RBA Rate Statement – the Reserve Bank of Australia surprised people with an increase of their Cash Rate last month. No increase is expected now, but the RBA’s rhetoric should be listened to as they comment about domestic and global economic conditions.

Wednesday, the 7th of June, Canada BoC Overnight Rate – Bank of Canada is expected to hold its borrowing costs in place, but inflation is still creeping into prices and the BoC’s Rate Statement may prove intriguing.

Thursday, the 8th of June, U.S Weekly Unemployment Claims – following in the footsteps of the stronger than expected jobs numbers last week, this report could get some media fanfare. However, it also may prove to be a lot of noise and have little real affect on market direction.

Friday, the 9th of June, China CPI and PPI – the inflation reports from China could prove interesting in wake of recent lackluster economic data from the nation. Last Thursday’s Caixin Manufacturing PMI results came in slightly better than expected, but data from China the week before was negative. The data from China gives investors and traders insights because of its importance as a global supplier of consumer products.

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FOMC Meeting Minutes and Key Growth Data Coming this Week

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

FOMC Meeting Minutes and Key Growth Data Coming this Week

Monday the 22nd of May, Japan Core Machinery Orders – which will likely have very little impact on the markets – not even the USD/JPY should react too much. Although it should be noted last month’s figure was negative and this month’s result is expecting a better outcome.

Monday the 22nd of May, E.U Consumer Confidence – forecast to produce a negative number, but this statistic doesn’t usually get much of a response in the financial markets unless there is a shocking result.

Tuesday the 23rd of May, E.U French and German Manufacturing and Services PMI, along with the broad E.U results – the manufacturing statistics from France and Germany are expected to come in slightly better than last month’s results but remain in negative territory.

Tuesday the 23rd of May, U.K Manufacturing and Services PMI – traders will watch these results after the bad GDP numbers from Britain almost two weeks ago.

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GBP/USD Three Month Chart as of 21st of May 2023

Tuesday the 23rd of May, U.S Flash Manufacturing and Services PMI – the reports could prove of interest and cause a bit of a tremor in the market, but unless there is a big surprise investors will remain cautious as they anticipate the next day’s potentially big risk events.

Wednesday the 24th of May, U.K Bank of England Governor Bailey – will be speaking at two events and could stir the GBP/USD with his comments on the British economy and inflation.

Wednesday the 24th of May, U.S Treasury Secretary Janet Yellen – will be speaking at a Wall Street Journal event, where she will be listened to for any comments on the ‘U.S debt ceiling” crisis. Yellen is a ‘trained’ speaker and she will try not to scare financial institutions who will have some leaders in attendance.

Wednesday the 24th of May, U.S FOMC Meeting Minutes – the report which will outline the U.S Federal Reserve’s thinking regarding its recent interest rate hike and what it might be considering regarding June could impact the marketplace. The report is published late in the day, but financial institutions will certainly wait for the publication and react. While the FOMC paper is sometimes considered ‘noise’, this report will be important because of the nervous sentiment which exists in markets like Forex and equity indices as they deal with a lack of clarity.

Thursday the 25th of May, U.S Preliminary Gross Domestic Product – the growth (or lack of growth) numbers from the States will be watched intently. A muted projected gain of 1.1% is anticipated by some analysts.

Thursday the 25th of May, U.S Preliminary GDP Price Index – this report will deliver insights regarding inflation in the U.S and should be given some attention by traders.

Friday the 26th of May, Core PCE Price Index – the inflation numbers should be watched. Any surprise above the anticipated 0.3% forecast could cause an affect in the financial markets.