US and Canada under the spotlight next week - 28.05 - 01.06.2018

The next week will start quietly, but it also end up a quite loud, taking into account the economic calendar highlights -  Bank Of Canada Interest rate decision, US Non Farm Payrolls and US GDP. The only thing we need to keep in mind at the beginning of the new week is that the markets in UK and the United States will be closed on Monday. I expect the volatility on the first business day to be particularly low, both on the FX market and on the exchanges in Asia and Europe. Traders will focus their attention first on ADP Non Farm Payrolls at 15:15 on Wednesday, and shortly thereafter at 5 pm on Bank Of Canada's decision on the base interest rate and on the bank's monetary policy report to lead in the near future. The data will be crucial for USD and CAD, and I expect the USD/CAD volatility to remain high throughout the day. What are the expectations? According to the consensus forecast among Wall Street traders, ADP will publish fewer jobs, compared to the previous one - 188K vs. 204K. The data will be indicative of the US labor market, and as more and more often happens, traders will trade the news more strongly on Wednesday than on Friday. With data higher or lower by 25 percent of the forecast, I expect the USD to set a strong momentum in that direction, and considering the key levels at which the Dollar Index is located, new jobs will be of paramount importance for the US currency. In Canada, I do not expect any changes in either the interest rates or the monetary policy that the central bank is leading. The main motives the bank will most likely highlight are the danger of a trade war and the uncertainty generated by Donald Trump's protectionist trade policy. The Canadian will play the other foundation, the one with oil. On the last day of the week, we watched the crash that everyone expected to happen. Black gold collapsed by nearly 7% in less than 24 hours after it became clear that Saudi Arabia would increase yields significantly. This will have a direct impact on the Canadian currency, and specifically for USD/CAD, I expect the sloping upward trend to remain. Last week it became clear that Trump and Kim Chen Un will not meet, and this gave strong support to the JPY. I expect the JPY growth to remain the same as next week, as we are seeing a stock market sell-off in the last few weeks of the week. Expected energy stocks are selling, with the strongest feeling in Europe. The main indexes of the continent reached their tops, but failed to record a breakthrough, and even back, in the last few minutes the bears prevailed. I expect sales to be kept in the next week.

The economic events that will move the markets next week - 28.05 - 01.06.2018

Monday
A holiday in UK and the United States
10:15 Switzerland - Unemployment rate

Tuesday
09:00 Switzerland - Trade Balance
17:00 USA - Consumer Confidence

Wednesday
01:45 New Zealand - Building permits
02:50 Japan - Retail Sales
04:30 Australia - Building permits
09:00 Germany - Retail Sales
11:00 Germany - Unemployment rate
11:00 Germany - Employment change
15:15 USA - ADP Non Farm Payrolls
15:30 US - GDP
15:30 Canada - Current Account
17:00 Canada - Bank Of Canada Interest Rate Decision
17:00 Canada - Bank Of Canada Monetary Policy Report

Thursday
02:50 Japan - Industrial production
04:00 China - Manufacturing PMI
04:00 New Zealand - Business Confidence
08:45 Switzerland - GDP
10:15 Switzerland - Retail Sales
12:00 Eurozone - CPI
15:30 Canada - GDP
17:00 USA - Existing Homes Sales
18:00 United States - Crude Oil Inventories

Friday
02:30 Australia - AIG Production Index
04:45 China - Manufacturing PMI
10:55 Germany - Manufacturing PMI
11:00 Eurozone - Manufacturing PMI
11:30 UK - Manufacturing PMI
15:30 USA- Unemployment rate
15:30 US - Non Farm Payrolls
17:00 USA - ISM Manufacturing PMI
20:00 USA - Baker Hughes Oil Rig Count

Read more:

• Investors pull record amounts out of US stock funds
• Oil rises after OPEC+ says to keep output cuts
• The Weakest Currency Of Them All
• China: April growth weakened due to distortions
• IMF cuts global growth outlook again