Markets This Week: Central Bank Decisions And US Jobs Data In Focus

The Federal Reserve and the European Central Bank affirmed their commitment to reduce inflation to 2%, especially after the recent rise in oil and food prices, which raised fears that inflation could rise again.


Both the European Central Bank and the US Central Bank raised interest rates by 25 basis points, and no decision has been taken yet as to whether more hikes will take place in September.


These central banks stressed the importance of upcoming economic data that will determine the course of monetary policy in the upcoming period, and that they are ready to shift the approach if necessary, leaving the door open to all possibilities.


The Bank of England is also expected to meet on Thursday amid expectations of raising interest rates by 25 basis points to reach 5.25%.


Looking at this week’s line up of economic data, here are the most important events to take note of.


Tuesday: Interest rate decision from the Reserve Bank of Australia, who are expected to raise interest rates by 25 basis points to 4.35%.


Wednesday: Employment data in the non-farm private sector, where expectations indicate that the US economy in the private sector added 195,000 jobs, lower than the previous reading of 497,000. If the forecasts are correct, this could incur a negative impact on the US dollar, according to analysts.


Thursday: The Bank of England meet to announce its latest interest rate decision. The decision will be followed by a press conference from Bank of England Governor, Andrew Bailey, to talk about his expectations and future vision for the economy. Thursday will also see a meeting of the OPEC Joint Ministerial Follow-up Committee, to discuss a range of issues related to energy markets.


Friday: Data on jobs in the non-farm sector and unemployment rates. Expectations indicate that the US economy added 200,000 jobs, less than the previous reading of 209,000. If expectations are true, this would indicate that the labor market is starting to be affected by higher interest rates. This could negatively affect the US dollar and positively impact gold and stocks, according to analysts. Meanwhile, the unemployment rate is expected to stabilize at the same current rate of 3.6%.




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