Three markets to watch next week (30.07.2021)

FOMC meeting did not turn out to be any kind of surprise, with US central bankers deciding to keep policy unchanged. US GDP release missed expectations significantly but it also did not trigger major moves on the market. Is there anything that could wake markets up from the summer lull? US NFP report could be the answer. Watch GOLD, GDPJPY and USDCAD next week!

GOLD

The Federal Reserve maintained its dovish stance this week and did not provide any hints on taper timing. US dollar took a hit and disappointing US GDP reading for Q2 did little to help it. Precious metals benefitted from the situation with the gold price bouncing off the $1,800 area and reaching a two-week high. Release of the US NFP report for July on Friday, 1:30 pm BST will be a key print next week and is likely to have an impact on precious metals. Market expects an addition of 900k jobs.

GBPJPY

While inflation is running hot, central banks in the developed world are reluctant to tighten policy. Spike of new coronavirus cases and resulting uncertainty, are one of the factors cited as a reason. The Bank of England is set to announce monetary policy decisions on Thursday at 12:00 pm BST. However, as the UK has been especially hard hit by the Delta variant recently it looks even more likely that BoE will stay on hold. A new set of macro forecasts may boost volatility on GBP-tied FX pairs, like GBPJPY which has been trading near 2-week highs recently.

USDCAD

While US jobs data will be the most closely watched this week, CAD traders should not forget about report from the Canadian labour market. It will be released simultaneously to the US report on Friday at 1:30 pm BST. Report for June showed a big 230k jobs addition that snapped a 2-month streak of declines. Will recovery continue? Summer period tends to support job increases due to pick-up in part-time job demand. USDCAD is likely to see a big jump in short-term volatility after the release.