Forecasting the upcoming week: US jobs report vs. Fed’s plans to cut rates

The US Dollar (USD) has shown signs of recovery on the weekly chart, reversing a series of three consecutive pullbacks as investors prepare for an important period leading up to the pivotal Federal Reserve meeting scheduled for September 17.

The US Dollar Index (DXY) reversed three weekly declines in a row, although it remained in the lower end of its yearly range near the 98.00 region. The US markets will be closed on Monday, September 1, due to the Labor Day holiday. On September 2, the ISM Manufacturing will take centre stage, seconded by the final S&P Global Manufacturing PMI, Construction Spending and the RCM/TIPP Economic Optimism Index. The usual weekly MBA Mortgage Applications are due on September 3, prior to the JOLTs Job Openings, Factory Orders, the Fed Beige Book, and the the API’s weekly report on US crude oil inventories. The weekly Initial Jobless Claims, Challenger Job Cuts, the ADP Employment Change, Balance of Trade results, the ISM Services PMI, the final S&P Global Services PMI, and the EIA’s weekly report on US crude oil stockpiles. The Nonfarm Payrolls will be the salient event on September 5, followed by the Unemployment Rate.

Quite an erratic performance left EUR/USD with decent losses this week, although it managed to rebound from earlier lows in the sub-1.1600 zone. The final HCOB Manufacturing PMI in Germany and the euro area will be released on September 1 alongside the Unemployment Rate in the bloc. The flash Inflation Rate in the eurozone is due on September 2. The final HCOB Services PMI in Germany and the euro zone are expected on September 3, seconded by Producer Prices in Euroland. On September 4 comes the HCOB Construction PMI in Germany and the euro area, ahead of the Retail Sales in the euro region. Germany’s Factory Orders, another revision of the Q2 GDP Growth Rate in the euro area, and the final EMU’s Q2 Employment Change will wrap up the calendar on September 5.

GBP/USD clinched its second consecutive week of losses, coming under fresh downside pressure and with gains so far capped around 1.3550. The Nationwide Housing Prices will kickstart the docket on September 1, seconded by Mortgage Approvals, the final S&P Global Manufacturing PMI and the BoE’s M4 Money Supply and Consumer Credit figures. The final S&P Global Services PMI comes on September 3, while the BoE’s Decision Maker Panel (DMP) and the S&P Global Construction PMI are due on September 4. Retail Sales will be released on September 5 along with the Halifax House Price Index.

No changes to the USD/JPY’s choppiness left it near the 147.00 region on Friday, managing to close the week with humble gains after two consecutive pullbacks. Capital Spending and the final S&P Global Manufacturing PMI will be published on September 1. The final S&P Global Services PMI is due on September 3, while the weekly Foreign Bond Investment prints are due on September 4. Household Spending will come on September 5, alongside Average Cash Earnings and the preliminary Coincident and Leading Economic Indexes.

AUD/USD maintained its bullish pulse throughout the week, surpassing the 0.6500 barrier in quite a convincing fashion. The final S&P Global Manufacturing PMI is due on September 1, followed by Building Permits, Private House Approvals, Business Inventories and Commodity Prices. The Q2 Current Account results are expected on September 2. On September 3, come the Ai Group Industry Index, the final S&P Global Services PMI and the Q2 GDP Growth Rate. The Balance of Trade readings are due on September 5, along with Household Spending.

Anticipating economic perspectives: Voices on the horizon

• The ECB’s Schnabel, Cipollone and Lagarde will speak on September 1.
• The BoJ’s Himino speaks on September 2, followed by the ECB’s Elderson and Machado.
• The Fed’s Kashkari will speak on September 3, followed by the ECB’s Lagarde and the BoE’s Mann and Breeden.
• The Fed’s Williams is due to speak on September 4, followed by the ECB’s Cipollone.
• The Fed’s Goolsbee speaks on September 5.

Central banks: Upcoming meetings to shape monetary policies

• The NBP will meet on September 3 (5.00% act. vs. 4.75% exp.)
• The BNM meets on September 4 (2.75% act. vs. 2.75% exp.)