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This week, the US Fed turned dovish and all risk assets like Commodities, Stocks, and EURUSD have a very strong rebound. Two weeks ago, Powell stated stating they are not sure whether the interest rate is tight enough. ironically, now they are saying they are discussing reducing interest rates in 2024.
Last week, NFP surprised the market by having higher-than-forecast results. NFP turned out to be 199K instead of the forecast of 180K. The US unemployment rate also reduced to 3.7%, better than the consensus of 3.9%. These number has proved that the US job market is still hot.
This week, we will have the most eventful week in December.
Last week, EURUSD was volatile and it broke 1.10 and then it dropped back to 1.08. This week we have a few important news announcements for EURUSD and AUDCAD.
Last week, Australia’s RBA became the first developed country to raise interest rates after a short period of pause for interest rate hikes. This we have US CPI and PPI announcements. On the European side, they also have their CPI announcement this week.
Last week, FOMC decided to keep their interest as it is. The comments from US Fed Chairman Powell were quite dovish, which resulted big bounce from EURUSD and break 1.07 level. This week, we have Australia’s RBA Interest rate decision.
After the ECB interest rate decision, this week we will have the FOMC Interest Rate Decision and Nonfarm Payrolls.
This week, we have 2 important economic announcements that we need to take note of for EURUSD and one for AUDCAD.
Last week was a very volatile week. EURUSD dropped from 1.059 to 1.044 and then back to 1.059 on Friday. Nonfarm payrolls for September give a very big surprise to the market. We have to be more cautious in this coming Monday and the CPI announcement for this week.
Since the last FOMC meeting, the USD has become very strong and the EURUSD has dropped to below 1.05, which is a level that we haven’t seen since January 2023. Only till Thursday of last week, then there is some slight rebound for EURUSD.
This week we have US job data – ADP and Non-Farm Payrolls. They are the indicator that the US Fed will monitor closely to decide their move on potentially the last rate hike for this cycle.
Last week, the ECB surprised the market by raising 0.25% interest to 4.50% but at the same time signaled this was likely to be its last. This week, it is the US FOMC Interest Rate Decision. Will they surprise the market too?