Forecasting the upcoming week: Central banks take centre stage

Another disappointing week saw the US Dollar (USD) add to its previous decline, briefly revisiting three-week lows on the back of declining US Treasury yields across the board, the resurgence of geopolitical concerns and jitters surrounding the AI-related stocks universe. Despite the risk-off environment and the unabated upside momentum in crude oil prices, the Greenback could not take advantage of this scenario.

The US Dollar Index (DXY) clinched its second consecutive week of losses, briefly easing toward three-week lows around 101.50, just to regain some composure afterwards. The Chicago Fed National Activity Index is due on October 26. On October 27 will come the ADP Employment Change Weekly figures, seconded by the final Building Permits data, Durable Goods Orders, New Home Sales, the FHFA’s House Price Index, The Conference Board’s Consumer Confidence gauge, and the API’s weekly report on US crude oil inventories. The usual MBA Mortgage Applications are due on October 28, followed by the advanced Goods Trade Balance results, Wholesale Inventories, and the EIA’s weekly report on US crude oil stockpiles. The usual weekly Initial Jobless Claims are expected on October 29, alongside the PCE, Personal Income/Spending, and another revision of the Q3 GDP Growth Rate. The Chicago PMI will wrap up the docket on October 30, seconded by the quarterly Employment Cost Index data.

EUR/USD could not sustain the bullish boost recorded in the previous week, eventually ending slightly in the red, albeit off recent multi-month lows. Germany’s IFO Business Climate will kickstart the domestic calendar on October 26. The ECB’s Loan to Companies/Households data come on October 27, while Germany’s GfK Consumer Confidence gauge is expected on October 28. The final Consumer Sentiment in Euroland is due on October 29. Closing the weekly docket on October 30, Germany will publish its labour market report, along with flash Q3 GDP Growth Rate figures and the preliminary Inflation Rate. In addition, advanced Q3 GDP Growth Rate data in the broader euro area will also be released.

GBP/USD further extended its recovery, up for the second week in a row, and managed to reclaim the area beyond 1.3400 the figure at some point during the week. The CBI Distributive Trades are due on October 26, while the BRC Shop Price Inflation will come on October 27. The release of the Autumn Budged is expected on October 28. The BoE’s Consumer Credit figures are due on October 29 alongside Mortgage Approvals/Lending and the BoE’s M4 Money Supply and Net Lending to Individuals figures. The Nationwide Housing Prices are due on October 30, followed by the BoE’s Decision Maker Panel (DMP).

USD/JPY built on the previous week’s decline, at some point navigating fresh five-week lows near the 156.00 region. The final Coincident and Leading Economic indexes are due on October 26. The usual weekly Foreign Bond Investment figures come on October 29 along with the Consumer Confidence gauge. On October 30, the Unemployment Rate is due followed by Tokyo CPI, Retail Sales, flash Industrial Production data, Housing Starts and Construction Orders.

A solid weekly rebound prompted AUD/USD to rapidly leave behind the previous decline, flirting with four-week tops north of the key 0.7000 yardstick. The key Inflation Rate will gather all the attention on October 28, while Export/Import Prices are due on October 29. Closing the calendar in Oz, quarterly Producer Prices are expected on October 30, seconded by Housing Credit/Private Sector Credit figures.

Anticipating economic perspectives: Voices on the horizon

• The AUD’s Bullock speaks on October 28.
• The Fed’s Musalem and Daly will speak on October 30 along with the BoE’s Mills.

Central banks: Upcoming meetings to shape monetary policies

• The RBNZ will decide on rates on October 28 (25 bps hike), alongside the BoT (unch), the BoC (25 bps hike) and the Fed (unch).
• The ECB meets on October 29 (unch).
• The BoJ will meet on October 30 (unch).