The Week Ahead – Week Commencing 21 October 2024
It looks like another volatile trading week ahead for markets, with geopolitics, data, and central banks playing significant roles in market movements. While there is less tier-1 data from the US this week, we do have some notable inflation figures from other regions.
The highlight of the week will likely be the European Central Bank’s rate decision on Thursday. However, there is potential for larger market moves on Monday after China failed to impress with a fresh stimulus update over the weekend, and inflation figures from the world’s second-largest economy fell below expectations.
Here is our usual day-by-day breakdown of the major risk events this week:
The week kicks off with a focus on Chinese markets, as the People’s Bank of China is set to release its latest Loan Prime Rate updates midway through the Asian session. Traders are anticipating further cuts, with expectations of a 0.2% reduction for both the 1-year and 5-year rates to stimulate the market. Elsewhere, little of note is scheduled for the day, though we will hear from the Federal Open Market Committee’s (FOMC) Lorie Logan and Neel Kashkari later on.
Central banks remain in the spotlight on Tuesday. Traders will also be keeping a close watch on any updates from the BRICS Summit being held in Kazan. Several key figures from central banks will speak during the London and New York time zones, including Bank of England Governor Andrew Bailey, European Central Bank President Christine Lagarde, the Monetary Policy Committee’s (MPC) Green and Breeden, and the FOMC’s Harker.
The Asian session is relatively quiet again on Wednesday. The BRICS Summit continues, but the action is expected to pick up in the North American session. Canadian markets will be in focus with the latest interest rate decision, statement, and press conference scheduled for early in the day. More speeches from central bank figures are expected, including Christine Lagarde, Andrew Bailey, and the Reserve Bank of New Zealand’s Adrian Orr.
A series of Services and Manufacturing PMI data releases are expected throughout the day from various regions, including Australia, Japan, France, Germany, the UK, and the US. In addition to the PMI data in the US, the weekly unemployment claims and New Home Sales figures are set to be released.
The week wraps up with a busy Friday. Early attention in Asia will be on Japan, where the latest Consumer Price Index (CPI) data from Tokyo is due. In Europe, the German IFO Business Climate data will be released, but the most significant data of the day will come from North America. Canadian Retail Sales figures and US Durable Goods data will be released early in the day, followed by the Revised University of Michigan Consumer Sentiment and Inflation Expectations later in the session.