Major central bank decisions and escalating Middle East tensions drove another volatile week across financial markets. The yen remains in focus after the Bank of Japan’s rate hike and subsequent rate checks by Japanese authorities. This week’s economic calendar is quieter, but Australian employment, Canadian retail sales and the Swiss National Bank rate decision remain key events, alongside a busy schedule of central bank speakers.
📌 Highlights
- Swiss National Bank Interest Rate Decision – CHF
- Australian Employment Data – AUD
- Canadian Retail Sales Data – CAD
🌍 Market Overview
It was another huge week for financial markets last week, with major central bank rate decisions driving volatility alongside the continuing escalation in geopolitical tensions across the Middle East.
FX traders will be keeping a particularly close eye on the Yen this week following Friday’s Bank of Japan rate hike and the subsequent move from Japanese authorities to check Yen prices after the currency weakened. USDJPY could remain particularly vulnerable to sharp moves during the first half of the week, with Japanese markets closed from Monday through Wednesday and significantly thinner liquidity expected during the Asian sessions.
The economic calendar is considerably quieter this week, with no major tier-one releases scheduled out of either the US or Europe. However, there are still several key events for traders to navigate, including Australian employment figures, Canadian retail sales and the latest Swiss National Bank rate decision. A busy schedule of central bank speakers should also keep interest-rate expectations firmly in focus.
Monday
The week gets off to a relatively quiet start on Monday, with little in the way of major economic data scheduled. Central bank commentary could provide some volatility, however, with ECB President Christine Lagarde and Bank of Canada Governor Tiff Macklem both due to speak. Traders will be watching closely for any fresh signals on the respective policy outlooks.
Tuesday
The calendar remains light on Tuesday, although central bankers will again be in focus as the sessions progress. RBA Governor Michele Bullock and ECB President Christine Lagarde are both scheduled to speak, before attention shifts to the Federal Reserve later in the day, with members Williams, Jefferson and Barkin all due to make appearances. Any fresh guidance on the US rate outlook could generate moves across the dollar and Treasury markets.
Wednesday
Economic data picks up on Wednesday with a raft of Flash Manufacturing and Services PMI releases across the global sessions. Numbers are due from Australia, France, Germany, the Eurozone, the UK and the US, giving traders a useful snapshot of global economic momentum and potentially generating some decent intraday opportunities across FX markets.
Thursday
Thursday looks like the busiest day of the week from a fundamental perspective. Australian employment figures are due during the Asian session and should provide an early test for the Aussie before attention shifts to the Swiss National Bank’s latest interest rate decision shortly after the London open.
The focus then moves to North America, where Canadian Retail Sales figures are scheduled alongside the usual US Weekly Unemployment Claims numbers. With several key releases packed into the day, volatility should pick up considerably across AUD, CHF and CAD markets.
Friday
It is a quieter calendar to close out the trading week. There is little of note scheduled during the Asian session, before attention shifts to the UK during European trading, with Bank of England Governor Andrew Bailey due to speak.
The US session brings Durable Goods data and the revised University of Michigan figures, although neither release is expected to match the significance of recent central bank events. After several highly volatile weeks, many traders will be hoping for a slightly smoother run into the weekend — although with geopolitical tensions still running high, that is far from guaranteed.