FED and other Central banks
Everything will be about major central banks and recovery fate. In the Week ahead, FED, SNB, and BOJ will meet while RBA realizes its meeting minutes. This Week will start with the Dragon festival Holiday in China. Monday Australian will take rest as it is the Queen's Birthday. Next days we have to wait for fundamental economic data as well. So let's take a look at the most important events of the Week.
RBA Meeting Minutes, Tuesday
Reserve bank of Australia will publish its May Meeting minutes on Tuesday. As RBA is one of the leading central banks in tapering policy, this meeting minutes will spark some light on RBA's following actions. Aussie has a soft movement against the US dollar; however, past weeks have some signs of the downtrend. Breaching under the lower band at 0.77 will confirm lower numbers for AUDUSD.
The UK and its essential numbers.
In the Week ahead, United Kingdom will publish Employment numbers on Tuesday, CPI on Wednesday, and retail sales on Friday. Besides them, Mr. Bailey will speak on Tuesday. April GDP numbers in the UK show strong signals of economic rebound with a 2.3% monthly rise. With positive GDP numbers, PMI in both service and manufacturing sectors rose in May and overall positive sentiment, telling us that we have to wait for other great numbers from the UK for the week ahead. However, Inflation from producer and consumer spending is both expected to rise, monthly and Yearly base. The pound was strong enough to trade above 1.40 against USD since the beginning of the month. Positive desired data must support the trend; even though the Strong dollar can correct it a bit, it is still trading higher in the long term.
FED and Wednesday!
A two-day policy meeting of FED will finish on Wednesday, and we will know if FOMC members will retreat against the background of market concerns over the inflation spikes. This Week's central question is, can the market push the Federal Reserve to start tapering its stimulus sooner than expected or not? Even though FED repeatedly said that higher Inflation is not there to stay for a longer-term, market participants still can not buy that. After all, most analysts are not expecting the Fed to begin discussing scaling back its asset purchase program before its annual conference in Jackson Hole, Wyoming, in late August.
China, where we have to check it carefully. Wednesday
Wednesday, the world's largest factory, will tell us how the May industrial production and Retail Sales have been growing. As domestic demand in-country is struggling, we are expecting both numbers to ease a bit. However, giving 18.3%, the strong growth in the first quarter, we are still expecting more than 8% increase this year for the Chinese economy. Still, this small ease can affect the energy market and cap the Oil uptrend around the same numbers or a bit lower for this month.
BOJ will end the Week.
The Bank of Japan will hold its monetary policy meeting and Interest rate decision on Friday. There is no fear of higher Inflation, and the market still feels the need for the government's help and dovish policies, so we are not expecting any changes in rate levels and its pandemic relief program. Japanese Yen, clearly weakening against USD and technically, any number above 108.80 will support its current uptrend.
