RBNZ meeting and earnings ahead

On Monday 7th: Nothing
On Tuesday 8th: Australian NAB Business Confidence, Australian RBA Meeting Minutes, Canadian Balance of Trade and Australian Westpac Consumer Confidence Change
On Wednesday 9th: German Balance of Trade and FOMC Minutes, RBNZ Monetary Policy Meeting
On Thursday 10th: American Core Inflation Rate YoY and American Inflation Rate YoY
On Friday 11th: UK GDP MoM, Canadian Unemployment Rate, American PPI MoM and American Michigan Consumer Sentiment Prel

Monday 7th of October

Nothing

Tuesday 8th of October

Australia's NAB business confidence index took a sharp downturn in August 2024, falling to -4 from the previous month's reading of 1. This marked the first negative reading in three months and the lowest level for the year so far. Market analysts anticipate that the Australian NAB Business Confidence for September will rebound to 2, with the data scheduled to be released at 12:30 AM GMT.

The Reserve Bank of Australia (RBA) held its cash rate steady at 4.35% during its September meeting. This marked the seventh consecutive meeting with unchanged borrowing costs, aligning with market expectations. However, the central bank expressed concern that inflation momentum, as measured by the trimmed mean, remains excessively high. The RBA reiterated its commitment to staying vigilant regarding potential upside risks to inflation, while maintaining flexibility in its policy approach. The bank stated that current interest rates are expected to remain restrictive for a considerable period. Market analysts will closely monitor the Australian RBA Meeting Minutes, which are scheduled to be released at 12:30 AM GMT.

The Australian Westpac-Melbourne Institute Consumer Sentiment index declined by 0.5% in September 2024, reversing the previous month's 6-month high of 2.8%. This marked the sixth decline of the year, reflecting a less optimistic outlook for the economy following sluggish GDP growth in the second quarter and concerns about potential job losses. Consumers' views on economic conditions for the next 12 months and 5 years both deteriorated, while unemployment expectations rose above their long-run average.

However, households reported improvements in their family finances compared to a year ago and expressed optimism about future financial prospects. Senior economist Matthew Hassan noted that the prevailing pessimism had not lifted, but also acknowledged that inflation news had become less concerning for households. Market analysts will closely monitor the Australian Westpac Consumer Confidence Change for October, which is scheduled to be released at 11:30 PM GMT.

The Canadian economy registered a trade surplus of CAD 0.68 billion in July 2024, marking the first surplus since February. This followed a revised deficit of CAD 0.18 billion in June and fell short of market expectations for a CAD 0.85 billion surplus. Market analysts anticipate that the Canadian Balance of Trade for August will decline to C$0.5 billion, with the data scheduled to be released at 12:30 PM GMT.

Major Earnings Release:

Pepsico

Wednesday 9th of October

Germany's trade surplus narrowed significantly in July 2024, falling to €16.8 billion from €20.4 billion in June. This was the smallest surplus since December 2022, as exports grew at a slower pace than imports. Market participants will closely monitor Germany's Balance of Trade for August, which is scheduled to be released at 6:00 AM GMT.

The Federal Reserve decided to cut the target range for the fed funds rate by a substantial 50 basis points to 4.75%-5% in September 2024. This marked the first reduction in borrowing costs since March 2020. While a rate cut was widely expected, there was some uncertainty as to whether the central bank would opt for a more cautious 25 basis point reduction. In addition to the rate cut, the Federal Reserve released updated economic forecasts. Market analysts will closely monitor the American FOMC Minutes, which are scheduled to be released at 6:00 PM GMT.

The Reserve Bank of New Zealand's (RBNZ) unexpected decision to cut the official cash rate by 25 basis points to 5.25% in August has led some experts to anticipate a more significant rate reduction of 50 basis points to 4.75% at the upcoming October Monetary Policy Review. This revised expectation is based on the improved inflation outlook, which is now projected to settle close to 2% from the third quarter of 2024.

The RBNZ's acknowledgment of this favourable inflation trend suggests that they have more flexibility to return to neutral interest rate settings more rapidly. The central bank has indicated that the pace of future rate cuts will depend on their confidence in a low inflation environment and the anchoring of inflation expectations around the 2% target. Additionally, the RBNZ has lowered its benchmark rate forecast to 4.92% by December, implying the possibility of further rate reductions before the end of the year. Market analysts will closely monitor the RBNZ's Monetary Policy Meeting, whose decision will be announced at 1:00 AM GMT.

Thursday 10th of October

The annual core consumer price inflation rate in the United States, which excludes volatile items like food and energy, remained at a three-year low of 3.2% in August 2024. This matched the previous month's figure and was in line with market expectations.

The annual inflation rate in the United States eased for the fifth consecutive month in August 2024, falling to 2.5% from 2.9% in July. This marked the lowest inflation rate since February 2021 and was below market expectations of 2.6%.

Market analysts predict that the American Core Inflation Rate YoY for September will decline to 3.0% and that the American Inflation Rate YoY for September will also continue to decline, reaching 2.4%, with both data scheduled to be released at 12:30 PM GMT.

Major Earnings Releases:

Delta Airlines

Friday 11th of October

The British economy experienced another stagnant period in July 2024, echoing the performance of the previous month. This growth rate of 0% fell short of market expectations for a 0.2% increase. Market analysts predict that the UK GDP MoM for August will see a slight improvement, reaching 0.1%, with the data scheduled to be released at 6:00 AM GMT.

The unemployment rate in Canada increased to 6.6% in August 2024, surpassing market expectations of 6.5%. This marked the highest unemployment rate since October 2021, indicating a continued softening of the Canadian labour market, as anticipated by the BoC's Governing Council. Market analysts predict that the Canadian Unemployment Rate for September will decline to 6.3%, with the data scheduled to be released at 12:30 PM GMT.

Factory gate prices in the United States rose by 0.2% in August 2024, following a revised flat reading in July and exceeding market expectations of 0.1%. This indicates a slight increase in prices for goods sold by manufacturers. Market analysts predict that the American PPI MoM for September will continue to rise, reaching 0.3%, with the data scheduled to be released at 12:30 PM GMT.

The University of Michigan consumer sentiment index for the United States was revised upward to 70.1 in September 2024. This marked the highest level in five months, surpassing the preliminary reading of 69 and exceeding market expectations of 69.3. Market analysts predict that the American Michigan Consumer Sentiment Prel for October will continue to rise, reaching 70.4, with the data scheduled to be released at 2:00 PM GMT.

Major Earnings Releases:

JPMorgan Chase
Wells Fargo
BlackRock

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