The most important events of the last week

Will the Reserve Bank of New Zealand raise interest rates?

US labor market data key to lower bond purchases

After a week described as relatively calm in terms of the economic agenda, the markets concluded the month of September and the third quarter of this year by the end of last week, so that the last quarter of the year begins Friday, the first session of the month of October, and therefore this week is considered the first weeks of October and the last quarter, as attention is directed towards the meeting of the Central Bank of New Zealand and Australia In addition to the data of the US labor market and many miscellaneous economic data that we will follow during the week.

A quick look at the most important events of the past week We started the week with the US Census Bureau’s announcement of the US durable goods orders index, which rose better than expected in August. Durable goods orders grow 1.8% in August – Fayezalajmi-4x.com

From Australia, retail sales fell in August to -1.7%, affected by continued closures in Australia’s two largest cities. Australian retail sales decline for the third month in a row – Fayezalajmi (fayezalajmi-4x.com)

The statements of US Federal President Jerome Powell’s testimony before Congress and the statements of members of the US Federal Reserve (Bullard – Brainard – Evans – Williams) since the beginning of the week supported the US dollar’s gains during the week, after it indicated the possibility of the US Federal Reserve announcing the reduction of its bond purchases at its meeting in November.

On the other hand, Janet Yellen, the US Treasury Secretary, expressed her fears of the US debt default and its consequences, and indicated that the default will lead to a strong financial crisis. Markets await the Senate’s vote on a temporary law preventing the federal government from being suspended – Fayez Al-Ajmi (fayezalajmi-4x.com)

The yield on US treasury bonds recorded increases at the beginning of the week, to trade at its highest level in three months, as the yield on ten-year treasury bonds tested 1.54 levels before declining at the end of the week to close at 1.465 levels.

Strong moves in the US dollar and the yellow metal in light of the rise in the yield on US bonds to its highest level in three months – Fayez Al-Ajmi (fayezalajmi-4x.com)

The US government avoided shutting down after Congress passed a funding plan that would keep the government running until December 3. The latest economic data from the US economy was positive, as the US personal income index rose by $35.5 billion in August.

The Fed’s preferred inflation indicator rises in August, and the dollar gains weekly – Fayez Al-Ajmi (fayezalajmi-4x.com)

The ISM manufacturing index in the United States of America improved to 61.1 in September, registering a growth for the 16th consecutive month, an increase of 1.2 compared to August’s reading.

The general index of the US dollar recorded weekly gains for the fourth consecutive week at closing at levels of 94.04, up by 0.80%, at the highest weekly closing level since September of last year, despite its declines in the closing session.

Labor market data and the Australian and New Zealand central banks lead this week’s events

During the sessions of this week, the markets are awaiting many important economic data that will have a direct impact on currency movements, on top of which is the data of the American labor market, which will definitely confirm the US Federal Reserve’s announcement to reduce its purchases of bonds at the meeting of the third of next November, in addition to the meeting of the Central Bank of Australia and the Bank of New Zealand and many more.

From the scattered data Reserve Bank of Australia

It is expected that the Reserve Bank of Australia will keep its monetary policy unchanged at its meeting on Tuesday and keep interest rates at 0.10% and continue to buy government securities at a rate of 4 billion dollars per week until February next year at least.

The latest economic data in Australia (employment and retail sales) showed a decline due to the closure of some Australian cities such as New South Wales and Victoria due to the spread of the new delta strain, and therefore the Bank is not expected to make any change in its monetary policy at this week’s meeting.

Reserve Bank of New Zealand

The Reserve Bank of New Zealand will announce its monetary policy on Wednesday, October 6, and expectations are that the bank will raise interest rates by a quarter point to 0.50% at its meeting this week, after the decision was postponed in an August meeting, with the government announcing new restrictions on the fourth level closure due to the Corona virus.

. After expectations were for a rate hike of half a point, market and analyst expectations fell to a quarter point hike only due to the impact of the closure in New Zealand on the economic recovery, but it remains the first major central bank to take this step.

US NFP .

Labor Market Data The US labor market data (change in employment, unemployment and wages) for the month of September will be announced at the end of this week, Friday, to be one of the most important economic data of the week, since it is one of the most important data that the US Federal Reserve looks at in determining its monetary policy.