Yes, there have been big weeks this year for financial markets, with lots of data such as the US jobless figures, central bank meetings to contend with, not to mention the rise in market volatility, and the usual monthly and quarterly data drops from China.
But this is the week of the key Fed meeting, culminating with the statement in the early hours of September 17, plus the new economic forecasts and the media conference with chair Janet Yellen, so it is the big week of the year for investors of all types in all markets.
That’s because many people in and around markets – professionals and punters – expect the Fed to start lifting interest rates this year for the first time since 2006.
Until the latest round of market instability and some weak data from China and emerging markets (Russia and Brazil for example) the Fed has been tipped to raise rates this week.
But now US futures markets have only a 28% chance of a rate rise being announced early Thursday morning our time.
if that doesn’t happen, then December looms as the next possible date for a rate increase.
But it’s not just the Fed this week that we hear from. The Reserve Bank of Australia releases minutes from its September meeting tomorrow.
The Bank of Japan also announces its rate decision tomorrow. No change is expected, but the commentary could be gloomy, while the Swiss National Bank is also expected to keep interest rates steady at its meeting later in the week.
But markets expect the Swiss bank to say that it was ready to cut the deposit rate even further into negative territory if necessary to battle any sign of renewed deflation. There is more on eurozone inflation this week as well.
Apart from the RBA minutes, it’s a quiet week in Australia. Reserve Bank Governor Glenn Stevens meets the House of Representatives Economics Committee on Friday. His comments on the Fed decision will be of considerable interest.
Later today the ACCC will either release a decision on the move by Foxtel to buy 14.9% of the Ten network, or issue a statement of issues raised during discussions with the market. Those issues could be enough to cause the deal to be blocked. The Commission will announce a decision on that in a month’s time, if the statement of issues is announced.
Tomorrow, the Bureau of Statistics releases the data on new motor vehicle sales for August. The industry group, the Federal Chamber of Automotive Industries, released the original data a week ago showing a 2.9% rise in sales to 90,705 in August.
The ABS data will report the industry estimates in seasonally adjusted and trend terms.
On Wednesday the Reserve Bank assistant governor for markets, Guy Debelle, delivers a speech titled ‘Some Current Issues in Financial Markets" at the Actuaries Institute Banking on Change Seminar in Sydney.
Apart from the Fed’s meeting, US data is scattered through the week. Industrial production and retail sales for last month will be released tomorrow night, our time.
Housing starts and building permits for August are out Thursday night, and the New York and Philadelphia Fed regional manufacturing conditions surveys will also be released.
US Republican presidential candidates will meet for a second televised debate on Wednesday. The debate will be hosted by CNN in California.
There will be a separate non-prime time debate for “candidates who meet the minimum threshold of 1% in public polling but are ranked outside the top 10”.
Governor Rick Perry of Texas dropped out last Friday, so there are now 16 candidates. Fox News held the first two debates last month.
In Europe, the key news will be confirmation of the latest eurozone inflation data due on Wednesday. It is likely to be low, thanks in part to lower energy prices. Before that, trade and employment data are issued tomorrow night, our time.
There’s the Swiss National Bank meeting as well. Eurozone industrial production is out later today.
Greece goes to the polls next Sunday, with the election up in the air.
In Asia the Bank of Japan announces its rate decision on Tuesday and Japan also updates to industrial production (today) and trade data (Thursday), with the Bank of Japan hoping to see the goods producing sector benefitting from the weakened yen.
After Sunday’s production, investment and retail sales reports, China sees the key release of house price data for August ton Friday.
The strength of the property market is widely seen as vital to the resilience of China’s domestic economy, and there have been signs of improvement in the past couple of months in bigger cities.
