ECB and Bank of Canada delivered rate cuts this week and launched easing cycles. Attention next week will shift to two other major central banks - Fed and Bank of Japan. Both are scheduled to announce decisions next week. Apart from that, traders will also focus on macro data from the US and the UK. Be sure to watch USDJPY, GBPUSD and US100 in the week ahead!
USDJPY
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile appInvestors will be offered rate decision from two of the world's most important central banks next week - Fed (Wednesday, 7:00 pm BST) and Bank of Japan (Friday, usually between 3:00 am and 5:00 am BST). Neither of the two is expected to change level of rates, but traders will look for some guidance. Currently, markets see Fed cutting rates in September or November, while BoJ could hike rates as soon as July. Whatever banks decide to tell the markets, elevated USD- and JPY-volatility is expected, so the week may be interesting for USDJPY traders.
GBPUSD
Fed meeting is not the only event scheduled for next week that may move USD. Before rate decision, traders will be offered US CPI inflation print for May (Wednesday, 1:30 pm BST), while flash University of Michigan data for June will be released on Friday, 3:00 pm BST). Investors will also get some data from the UK this week - jobs report for April (Tuesday, 7:00 am BST) and monthly GDP report for April (Wednesday, 7:00 am BST). Having said that, some volatility on GBPUSD should be expected around the middle of the week.
US100
Tech-heavy Nasdaq-100 (US100) tends to see some of the biggest reactions to Fed policy meetings among major Wall Street indices. This means that the index may become more volatile on Wednesday when Fed announces rates. However, there is also another noteworthy event to watch - Nvidia's 10-for-1 stock split, with company beginning to trade on post-split basis on Monday. Stock splits have no direct impact on value of owned shares, but they make shares more affordable, so could result in increase demand. However, this is not always the case and stock-split performed by, for example, Tesla in 2022 marked local highs on the chart.
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
