Weekly forecast for September 03-07

3 September, 2018

September 3

China-Africa summit and Labor day in the US and Canada

A summit on economic cooperation between China and African countries will be held in Beijing. The role of the PRC in restoring the economy of the poorest countries of the African continent.

A projects under the Belt and Road Initiative (BRI) is going to be the most interesting theme of the summit for the investors. According to some experts, Africa is the most focused destination under the BIR.

Meanwhile, the United States and Canada will be celebrating Labor Day. Stock exchanges will be closed in these countries. On such days, volatility in the forex market is also very low.

In the absence of a major market driver, the traders fill focus on retail sales in Australia sales, as well as to the manufacturing PMI in China, Germany and the United Kingdom. Cryptocurrency market is not expected to be flat, either.

We remind you that the purchasing managers’ index indicate not the level of actual production, the level of activity in production.

September 4

Cash rate target of The Reserve Bank of Australia

On Tuesday, the Reserve Bank of Australia will make a decision on the interest rate. Market participants do not expect the regulator to take any drastic steps. The probability of keeping the rate at the previous level of 1.5% is 99.7%.

At the same time, comments to the minutes of the previous meeting indicate an increasing likelihood of further rate hikes.

September 5

Hearings in the US, GDP in Australia and the Bank of Canada’s interest rate decision

The US Congress will hold regular hearings on Russian interference in the 2016 U.S. presidential election. This time, officials will discuss the actions taken to confront the "attacks" on American democracy.

Republican congressmen may be under the impression after Donald Trump accused Twitter, Facebook and Google of biased search results. Therefore, the movement of shares will depend on the hearings.

Twitter CEO Jack Dorsey has been confirmed to attend the Senate hearings.

On Wednesday, Australia will release GDP in the 2nd quarter. Economists expect a slowdown in growth to 0.9% (the previous value was released at 1%).

Meanwhile, it is possible that consumption in Australia has increased. And this, of course, will be a positive factor for the economic growth in general.

The Bank of Canada releases the rate decision at 14:00 GMT. 90.2% of market participants are confident in keeping the rate at 1.5%.

September 6

An escalation of the trade war and the ADP national employment report

On Thursday, US tariffs on $ 200 billion worth of Chinese goods can come into effect. The move is an escalation of the trade war. China is ready to give mirror response to the tariffs.

Offshore Chinese yuan has already shown signs of weakening. Apparently, traders react to the approaching trade restrictions. The dynamics can continue if the People's Bank of China does not interfere with the situation.

ADP report is released one day later. We remind that the ADP’s figures quite often don’t correlate with the actual NFP.

Besides, no less important statistics on the number of open vacancies will be provided by the Challenger, Gray & Christmas Inc and Conference Board agencies.

September 7

ETH Hackaton, cryptomarket regulations and Nonfarm Payrolls

A meeting of financial affair ministers of the eurozone takes place in Vienna. One of the main issues will be the implication of cryptocurrencies in the eurozone. The summit will last until September 9.

Also, ETH Global Hackaton will take place in Berlin on September 7. There will be lot of working meetings where leading experts will give their speeches. The conference is held under the auspices of Berlin Blockchain Week.

Perhaps, these events will provoke another surge in the volatility of the cryptocurrency. In particular, the outcome of the summit in Vienna can affect the digital money negatively, as the anonymity of the participants may be under attack.

The week ends with the release of nonfarm payrolls, the indicator that has always been best economists’ concern. Will the growth in the labor market continue in the United States, or is it going to decline?

400,000 American companies and 60,000 American families provide information on the employment situation to the U.S. Department of Labor’s Bureau of Labor Statistics. The world market is looking forward to the nonfarm payroll report.

Upcoming events next week10 Sep, 2018  

The week will be very important in terms of macroeconomic news. We expect high market volatility and recommend that you are especially careful when trading.

Resumption of financial markets activity24 Aug, 2018  

The Turkish financial markets will resume their work today. Investors are worried about the lira, because Erdogan still refuses to release American pastor...