FX Week Ahead - Top 5 Events: EZ GDP and CPI; Canada GDP; FOMC; US NFP

Talking Points:

- Soft growth and inflation readings are likely to renew speculation that the European Central Bank will change its Staff Economic Projections at the June ECB meeting.

- There is a possibility that the FOMC comes out with a more hawkish tone than what was previously deployed.

- Markets are expecting the rebound in jobs growth to continue, with headline NFP coming in at 185K.

Join me on Mondays at 7:30 EDT/11:30 GMT for the FX Week Ahead webinar, where we discuss top event risk over the coming days and strategies for trading FX markets around the events listed below.

04/29 TO 05/07 | JAPAN GOLDEN WEEK – JAPANESE MARKETS CLOSED

It‘s the end of April, which means it’s time for Japans “Golden Week.” The Golden Week is typically a period at the end of April/beginning of May that encompasses several holidays during a short timeframe, and due to the inefficiencies of frequently opening/closing businesses, many factories shutdown and offices work on skeleton crews. In turn, Japanese financial markets are also closed.

Read the full report: Japan Golden Week & AUDJPY Price Forecast

04/30 TUESDAY | 09:00 GMT | EUR EUROZONE GROSS DOMESTIC PRODUCT (1Q A), 05/03 FRIDAY | 09:00 GMT | EUR EUROZONE CONSUMER PRICE INDEX (APR A)

The first look at Q1‘19 Eurozone GDP on Tuesday should see growth rates remain tepid at best, with the quarterly rate due in at 0.3% from 0.2% while the yearly rate is set to hold at 1.1%. Consistently weak growth figures should serve to underscore the European Central Bank’s Governing Councils view that risks have moved “to the downside.” Elsewhere, the preliminary April Eurozone Consumer Price Index is due on Friday at 1.6% from 1.4% (y/y), a sign that weakness in the Euro in recent weeks coupled with the ongoing rebound in oil prices may be helped stabilize the price outlook.

Read the full report: Q119 Eurozone GDP and CPI & EURJPY Price Forecast

04/30 TUESDAY | 12:30 GMT | CAD GROSS DOMESTIC PRODUCT (FEB)

The February Canada GDP report doesnt appear like to will help traders or BOC policymakers find any clarity over the near-term economic environment. It appears that February represented the low point in growth conditions across the world: Eurozone PMIs declined in February; US GDP estimates were lowest in late-February and early-March.

Read the full report: February Canada GDP & USDCAD Price Forecast

05/01 WEDNESDAY | 18:00 GMT | USD FEDERAL RESERVE RATE DECISION

The Federal Reserve meets on Wednesday for its May meeting, and both economic and market conditions couldn‘t be more different than when the FOMC last met. In March, concerns were running rampant that the US government shutdown was going to have a significant negative impact on Q1’19 US GDP, which at this point in time, we know was overblown: 3.2% annualized growth was reported last week.

Read the full report: May Fed Meeting & USDJPY Price Forecast

05/03 FRIDAY | 12:30 GMT | USD CHANGE IN NONFARM PAYROLLS & UNEMPLOYMENT RATE (APR)

The US labor market remains a pillar of strength for the US economy, and all signs pointed to another solid jobs expansion in April. Following the print of 196K in March, Bloomberg News consensus forecast is looking for 185K jobs to have been added in the fourth month of the year. As a result, forecasts point to the unemployment rate staying on hold at 3.8%, a multi-decade and cycle low.

Read the full report: April US Nonfarm Payrolls & EURUSD Price Forecast