Review of the main events of the Forex economic calendar for the next trading week (20.09.2021 – 26.09.2021)
The dollar rose last week, while the major US stock indexes traded mostly in the range after declining a week earlier. The strengthening of the dollar is facilitated by the positive macro statistics coming from the United States and the talk that the Fed may begin to wind down its stimulus program by the end of this year.
The focus of investors’ attention next week will be on the Fed meeting, at which the central bank executives are likely to also keep the loose monetary policy in place, but may announce the possibility of starting to roll back the QE program this year, for example, after the November Fed meeting.
The Fed has maintained its key rate at 0.25% since March 2020, purchasing at least $120 billion in government bonds and mortgage bonds every month since June 2020.
Nevertheless, the opinions of market participants regarding the short-term prospects of the dollar after the Fed meeting were divided. Approximately half of them believe that the Fed’s decision and its statement, which may contain a signal that the discussion of the stimulus reduction will begin earlier than expected, will not affect the dynamics of the dollar.
Nevertheless, unexpected and more radical statements on the part of the Fed are possible.
In case signals toward the tough stance follow from the Fed, it will lead to the closure of a significant part of the short positions in the dollar and to its strengthening. The tougher the statements of the Fed leaders at the end of the September meeting, the stronger the dollar will strengthen.
Thus, the focus of the financial market participants next week will be on the Fed meeting, which will end with the publication of the rate decision.
Nevertheless, optimism prevails on global stock exchanges, associated with the expectations of a further recovery in the global economy, both against the background of the unfolding vaccination against coronavirus in Europe and North America, and over the soft policy of the world’s largest central banks.
Next week, financial market participants will also pay attention to the publication of important macro statistics from the UK, US, Germany, Eurozone, Canada and the results of meetings (in addition to the Fed) of the central banks of China, Japan, Switzerland, and the UK.
*during the coming week, new events may be added to the calendar and / or some scheduled events may be canceled
Monday, September 20
No important macro statistics planned to be released.
Tuesday, September 21
01:30 AUD Minutes of the September meeting of the RB of Australia
This document is published two weeks after the meeting and the decision on the interest rate. If the RBA positively assesses the state of the labor market in the country, the rate of GDP growth, and also shows a hawkish attitude towards the inflation forecast in the economy, the markets regard this as a higher probability of a rate hike at the next meeting, which is a positive factor for the AUD. The bank’s soft rhetoric regarding above all inflation puts pressure on the AUD.
During the last (September) meeting, the RBA kept the key interest rate and the target level of yield on three-year government bonds unchanged, at around 0.10%.
At the same time, the leaders of the RBA decided to start reducing weekly purchases of government bonds. The buyback program will now amount to AU$ 4 billion per week (up from AU$ 5 billion previously) until at least mid-February 2022. The RBA head Philip Lowe promised that “the RBA will review…