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Bank Of England on focus next week, what else to expect
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Loading...Next week, it looks quiet from economic data with one exception - the Bank of England interest rate decision on Thursday. We should not divert our attention from the meeting in Beijing, between the US and Chinese authorities trying to reach an agreement to avoid a trade war. The US Trade Delegation in China is holding "very good" talks with the Beijing authorities. This was stated by US Treasury Secretary Steven Mnuchin before the start of the second and probably the last day of the talks. Agreement on some issues has been reached, but it has become clear that the differences between the US and China are deepening. The meeting allowed leaders to discuss a wide range of topics, and this led to the discovery of new differences. We are expecting more information over the weekend about what decisions were made at the Beijing summit. For this reason, I expect the launch of the markets on Monday to be marked with gaps, mainly in the dollar exchange rate currencies and less likely in US futures on the main indices. Positive news for the United States from Beijing will support the USD over the next week.
Investor focus will move quickly from the meeting in Beijing to Bank Of England in London. The central bank is expected to keep interest rates unchanged at 0.50%, as well as a QE of 435 billion. pounds. But this will not move GBP after the decision, but the bank report as well as the Dot Plot system, which shows how many members voted for and against raising interest rates. This will give a clear idea of the sentiment among central bankers. In the last few weeks, we have witnessed bad economic data from the island, and the trend in question is unlikely to change. On Thursday, central bankers will have to answer the question of how they are going to act in a situation of rising inflation and worsening economic data such as GDP, retail and primary housing. What we will most likely hear from central bankers is that BOE will wait for improvement in the economic environment before taking any further steps towards raising interest rates or terminating QE. GBP is at key levels of support over a large portion of the major currencies and the bank's decision will be key to further development. If we see Dovish sentiment among Central Bank members, it is likely that the strong support levels will fall and the fall of the British currency will continue.
The economic news that the markets will move next week - 07.05 - 11.05.2018
Monday
A holiday in the UK
02:30 Australia - AIG Construction Index
02:50 Japan - Monetary Policy Report
04:30 Australia - Business confidence
06:00 China - Currency Reserves in USD
09:00 Germany - Factory orders
10:15 Switzerland - CPI
Tuesday
02:50 Japan - Household expenses
04:30 Australia - Retail sales
06:00 New Zealand - Inflation expectations
08:45 Switzerland - Unemployment rate
09:00 Germany - Trade Balance
15:15 Canada - Primary Housing Construction
23:30 US - API crude oil inventories
Wednesday
No Schedule - Trade Balance of China
01:45 New Zealand - Retail sales via credit cards
02:01 UK - BRC retail sales
03:30 Australia - Westpac Consumer sentiments
15:30 USA - PPI
15:30 Canada - Building permits
17:30 US - Crude oil inventories
Thursday
Holiday in Switzerland
00:00 New Zealand - Interest rate decision - RBNZ
00:00 New Zealand - RBNZ Monetary policy Report
00:00 New Zealand - Press conference of RBNZ
04:30 China - CPI
04:30 China - PPI
11:00 ECB - Economic Bulletin
11:30 UK - Industrial Production
11:30 UK - Industrial Production
11:30 UK - Trade Balance
14:00 United Kingdom - Bank Of England decision on the basic interest rate
15:30 US - CPI
15:30 USA - Requests for unemployment benefits
Friday
04:30 Australia - Housing Loans
15:30 USA - Unemployment rate
17:00 US - Michigan Consumer Moods
Trader Petar Milanov Read more:
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