The Week Ahead: 8th – 12th April 2024

Overview for the Week Ahead

Highlights of the Week

US CPI Report and Fed Speakers to influence investor bets on a June Fed rate cut.
The ECB, the RBNZ, and the Bank of Canada will announce monetary policy decisions.
The Chinese economy will be in the spotlight as investors eye inflation and global trade terms.

In general, the markets are looking for confirmation from the European Central Bank that a June rate cut is really coming, though oil is on the rise again, clouding the inflation picture.

For the US, the US CPI Report will impact the US dollar more on Wednesday. Sticky inflation could materially affect bets on a June Fed rate cut.

With inflation in the spotlight, producer price figures will garner investor interest on Thursday. Producers may increase prices in a high-demand environment, passing prices onto consumers. Investors must also consider US labor market data on Thursday after the larger-than-expected increase in jobless claims in late March.

On Friday, Michigan Consumer Sentiment figures will move the dial. A drop in consumer sentiment could signal a downward trend in consumption and support a June Fed rate cut.

Beyond the numbers, the Fed will be in the spotlight. Monitoring FOMC member reactions to the inflation figures is crucial. On Wednesday, the FOMC meeting minutes will also be out. However, the recent Jobs Report and inflation figures could limit the impact of the minutes on the US dollar.

On Thursday, the ECB will be in focus. The markets expect the ECB to leave interest rates at 4.5%. Unless there is a surprise ECB rate cut, the ECB press conference will likely have a greater impact on the EUR/USD. Forward guidance on the timing of an ECB rate cut and the interest rate trajectory for 2024 would move the dial.

On Friday, finalized French and German inflation numbers also need consideration. The EUR/USD will likely react to revisions to the preliminary numbers.

On Thursday, UK housing sector data and the Bank of England Credit Conditions Survey will warrant investor attention. Housing price trends could influence consumer confidence and private consumption. Upward trends in private consumption may fuel demand-driven inflation and affect the BoE rate path.

The monthly GDP Report will be in focus on Friday. The UK economy showed resilience at the turn of the year. Better-than-expected GDP numbers could influence investor bets on a Bank of England rate cut. Services sector trends need consideration as the contributor to inflation.

The Bank of Canada will be the focal point for the Loonie. On Wednesday, the BoC will announce its March Monetary Policy Decision. Economists expect the BoC to leave interest rates at 5.0%. Barring an unexpected BoC rate cut, the focus will be on the monetary policy report and press conference.

Forward guidance on the timeline for a Bank of Canada rate cut and the frequency of rate cuts could move the dial.

Economic data includes building permits, out on Wednesday. However, the numbers will play second fiddle to the Bank of Canada.

Have your trading charts ready this week!

This Week’s High Impact Events

The times below are GMT +3.

Monday 8^th April

No High Impact Events

Tuesday 9^th April

No High Impact Events

Wednesday 10^th April

05.00 – New Zealand – Official Cash Rate, RBNZ Rate Statement

Potential instruments to Trade: NZD Crosses. 

15.30 – US – Core CPI m/m