FX Week Ahead Overview:
- Central banks are in focus, with the Reserve Bank of Australia (Tuesday), the Federal Reserve (Wednesday), and the Bank of England (Thursday) on tap in the middle of the week.
- Labor market reports define a busy first week of November, with data due from New Zealand, Canada, and the United States over the coming days.
- On the lower end of the spectrum, global PMI readings – particularly from Asia and Europe – could introduce additional volatility to FX markets.
For the full week ahead, please visit the DailyFX Economic Calendar[1].
11/02 TUESDAY | 03:30 GMT | AUDReserve Bank of Australia Rate Decision
The Reserve Bank of Australia looks ready to abandon its yield curve control (YCC) policy, having allowed the front-end of the Australian government bond curve to blow out over the past week. The RBA will likely signal that it will end its QE program by mid-1Q'22, and the first rate hike will arrive sometime in mid-2022, putting it well-behind the pace of its RBNZ counterpart (which should hike again this year). Regardless, the Australian Dollar[2] – with a persistent net-short position in the futures market – is well-positioned to continue its rally.
11/03 WEDNESDAY | 18:00 GMT | USD Federal Reserve Rate Decision & Press Conference
The 3Q’21 US GDP report may have proved disappointing in some respects, but not enough to have dissuaded policymakers that it’s now time to taper. Throughout October, several Fed policymakers suggested that they believe “substantial progress” has been achieved, and in context of persistently higher inflation pressures, that tapering should begin as soon as possible.
As has been the case for several weeks now, continually elevated Eurodollar spreads alongside action in the US yield are consistent with the 2013/2014
