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Recap

EUR/USD and USD/JPY disappointed last week for the traders who took contrarian side of the trade. It worked much better for EUR/NZD and EUR/GBP longs for the week. Coming week may be somehow muted in comparing to recent increase in volatility, one aspect to watch in my book will be strengthening of JPY (see the currency board below). RBA will announce their rates on Monday night/Tuesday morning depending on the timezone as well as BOE rates will be announced on Thursday. Those events are worth keeping close eye on as they likely to have impact on AUD and GBP respectively.

Weekly Currency BoardPrime Risk Events (UTC time)  Tuesday Bank of Japan monetary policy statement (October), TBC: The Japanese central bank is not expected to make any broad changes to policy, but it may hint that its time fame for achieving 2% inflation will be tweaked. This would likely exert additional downward pressure on USD/JPY. Market to watch: USD/JPYReserve Bank of Australia interest rate decision (Oct), 3.30pm: Expectations are for the Australian central bank to leave rates unchanged at 2.5%. Market to watch: AUD/USDGerman industrial production (August), 7am: Data from Germany is still weak, with year-on-year growth forecast to slow to 0.6% from 2.5% in July. Market to watch: DAX, EUR/USD, EUR/GBPUK industrial & manufacturing production (August), 9.30am: This data is expected to be mixed, with YoY industrial production falling 0.84%, while the manufacturing figure is expected to see growth of 4.87%. Market to watch: GBP/USD, EUR/GBP Wednesday HSBC China services PMI (September), 2.45am: The figure is forecast to drop to 53.03 from the August reading of 54.1. Market to watch: China A50, [indices:HS42|Hong Kong HS50], AUD/USDUS EIA crude inventories: As the bear market in oil continues, the data should offer some comfort if it does show a drop in inventories. Market to watch: US Light CrudeFed minutes (September), 7pm: The Fed hawks have become more vocal of late, but the ‘considerable time’ reference stayed in place. Markets will look to see which Fed members dissented from the decision. Market to watch: All major indices and global FX crosses Thursday Australian unemployment (September), 1.30pm: The jobless rate is expected to hold steady at 6.1%, while the number of jobs added is expected to be 12,000, from 121,000 in August. Market to watch: S&P 500/ASX 200, AUD/USDEuropean Central Bank Monthly Report (October), 9am: This report provides commentary on the state of the eurozone economy. Keep an eye out for discussion of inflation, possible additional measures to boost the economy, and the GDP estimate. Market to watch: EUR/USD, EUR/GBPBank of England meeting (October), 12pm: Like most BoE meetings, no change is expected, which will leave markets to await the minutes later in the month to see if the voting patterns have changed. Market to watch: GBP/USD, EUR/GBPUS initial jobless claims, 1.30pm: The figure dropped to 287,000 last week, and a fall to 283,000 is forecast this week. Market to watch: US indices, dollar crosses Friday UK trade balance (August), 9.30am: The gap between the UK’s exports and imports is forecast to widen slighty, to £3.4 billion, from £3.348 billion last month. Market to watch: GBP/USD, EUR/GBPCanadian unemployment (September), 1.30pm: The jobless rate in Canada is forecast to hold at 7%, with 8400 jobs added in the month. Market to watch: USD/CAD

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