Calendar Week 44 – 2021

A busy week of economic releases ahead of us with the focus on the Central Banks of Australia (Tuesday afternoon), USA Fed (Thursday morning) and the Bank of England (Thursday evening). None of the banks are expected to raise rates at this point, however there is high expectations that the Australian RBA will reduce their massaging of the yield curve.

The RBA has been buying bonds in an attempt to hold rates lower. With rising inflation, they have lost control of this as bond bandits have pushed rates over 1% last week. Market participants do expect the RBA to quit buying bonds and announce new forward guidance of where interest rates are going to be next year.

The USA is in a similar position with the Fed expected to also announce a tapering of their Quantitative Easing program as inflation starts to take hold on the worlds largest economy. All eyes will be on the Dot Plot – forward guidance – and Powell’s conference at 430am.

The BoE is not expected to change its QE settings or raise rates so it should be a non-event, still, be aware of the meeting and cautious of GBP trades around it.

Elsewhere this week, there is Chinese and USA manufacturing survey’s on Monday and Chinese import/export numbers on Sunday. Thursday night is USA balance of trade and Friday is USA jobs data, the Non-Farm Payrolls.