The volatility that the markets experienced last week promises the second tidal wave! What should your favorite assets anticipate during the first week of February?
British CPI will set the way for the GBP
The British pound tends to trade with high volatility as the Brexit deal remains cloudy. One day there’s a rumor of an agreement between Britain and the European Union and the next day it’s denied. To support the wavy pound, the Bank of England needs to raise the interest rate. However, a rate hike will be possible if only the economic data display a stable growth. CPI or consumer inflation index is one of the most important economic indicators as it correlates with the central bank’s inflation target. If the CPI increases, the central bank has more reasons to raise the interest rate in the near future. The CPI data will be out at 11:30 MT time on September 18.
• If CPI exceeds forecast, the GBP will gain.
• If CPI disappoints, the GBP will fall.
As Europe moves into recession, next week may provide us with some amazing trading opportunities. Here they are!
Main news that will drive the market in the upcoming week include CB Consumer Confidence Index, Canadian GDP, and US Core PCE Price Index
The Federal Reserve (Fed) will announce its Interest Rate Decision and make a statement about the future monetary policy on Wednesday, September 21, GMT+3. After the higher-than-expected inflation numbers published on September 13, there’s almost no doubt the Federal Reserve will come up with another 75-basis-point rate hike. However, surprised by the CPI numbers, several Fed members announced the possibility of a 100-basis-point rate hike on Wednesday.