FOMC and NFP take center stage

The U.S. dollar went through another week where data releases and expectations of a Federal Reserve interest rate cut remain at the center of debate. Accordingly, the USD Index (DXY) appears to have begun a gradual decline after hitting a yearly high earlier this month. However, this withdrawal should be considered temporary.

This was a negative week for the greenback, which widened its repudiation from annual highs despite a rise in US yields as investors reassessed the timing of the US Federal Reserve’s first rate cut. The ever-relevant Consumer Confidence Index, tracked by the Council, will be released on April 30 along with FHFA’s Home Price Index and Employment Cost Index. On May 1, all attention will be on the Fed’s interest rate decision based on ADP employment changes, ISM manufacturing PMI, construction spending and the final S&P Global manufacturing PMI. Additionally, the deadline for initial unemployment claims is May 2, earlier than factory orders and trade balance results. As the week ends, the market’s focus will shift to non-farm payrolls, unemployment rates, final S&P Global Services PMI, and ISM Services PMI.

EUR/USD rose for the second week in a row and finally broke the key barrier of 1.0700, helped by improving sentiment in the risk-related galaxy. Germany’s preliminary inflation rate will be released on April 29, as will the euro area’s final consumer confidence index. On April 30, German retail sales, first quarter GDP growth and labor market reports will be released, followed by euro zone inflation rates. The final HCOB manufacturing PMI for Germany and the euro area is due to be released on May 2, followed by the unemployment rate for the EMU on May 3.

Following its dangerous peers, GBP/USD made a sharp reversal from two consecutive weeks in negative territory, reclaiming the area above 1.2500. In the UK, mortgage approvals and mortgage lending close on 30 April ahead of the final S&P Global Manufacturing PMI release on 1 May. National home prices are scheduled to be released on May 2 before the final S&P Global Services PMI is released. May 3

As the selling pressure of the Japanese yen did not subside, USD/JPY eventually reached a new high at just over 157.00. The Japanese calendar shows unemployment on April 30, followed by industrial production and retail sales. The consumer confidence index will be released on May 1, and the BoJ meeting minutes and foreign bond investment index will be released on May 2.

Improved sentiment in commodity markets, combined with renewed selling behavior in the US dollar, kept AUD/USD on a positive note for several sessions. On the data front, in Australia, home credit closes on April 30, along with luxury retail sales. The final Guidance Bank Manufacturing PMI and Ai Group Industrial Index will be released on May 1, ahead of the trade balance results and flash building permits announcement on May 2. Finally, home lending figures, home investment loans and final inducing banks are announced. The service PMI release date is May 3.

Additionally, China’s manufacturing and non-manufacturing PMIs tracked by NBS will be released on April 30 ahead of the Caixin Index on May 6.

Economic Perspective Forecasting: Voices on the Horizon

• BoC’s Macklem, RBNZ Orr to speak on 1 May.
• BoC’s Macklem speaks on May 2.
• Fed officials Goolsbee and Williams are scheduled to speak on May 4.

Central Bank: Upcoming Meeting to Set Monetary Policy

• The FOMC is expected to keep interest rates unchanged when it meets on May 1.