Last week was marked by significant attention on global economic data and central bank decisions. The US Federal Reserve’s stance on easing policy was highlighted, with markets closely analyzing jobs data in relation to potential rate cuts. The Bank of Canada (BoC) also remained in focus as investors anticipated a third consecutive rate cut amidst ongoing economic adjustments. Additionally, geopolitical tensions in the Middle East over the weekend had the potential to influence market movements as the new week began.

Last Week’s Summary:

• US Market Reactions: Markets reacted to Fed Chair Jerome Powell’s speech at the Jackson Hole Symposium, where he hinted at easing monetary policy, highlighting the importance of the jobs market.
• US Treasury Yields & USD: A decline in US Treasury yields and the US dollar followed disappointing July employment data.
• BoC Outlook: The Bank of Canada (BoC) continued to signal potential rate cuts amid slowing inflation and stagnant labor market conditions.

Weekly Market Outlook: US Labor Data and BoC Rate Announcement

As we move into the first week of September, markets are set for a data-heavy week, particularly from the United States, alongside the first major rate decision of the month from the Bank of Canada. Here’s a day-by-day breakdown of the key events:

Monday, September 2, 2024

• Global Markets: Expect a quieter start to the week with only lower-tier data scheduled, as Bank Holidays in both the US and Canada will likely dampen trading volumes. However, geopolitical tensions, especially in the Middle East, could influence the oil and gold markets.

Tuesday, September 3, 2024

• Switzerland: Early in the European session, focus shifts to the Swiss economy with the release of CPI data and GDP figures, which may impact the Swiss Franc.
• United States: The first significant US data of the week, the ISM Manufacturing PMI, will be released shortly after the New York market opens.

Wednesday, September 4, 2024

• Australia: The day begins with Australia’s Quarterly GDP data during the Sydney session.
• United States: Focus then moves to the US, with the release of the JOLTS Job Openings, followed by the Bank of Canada’s Rate Decision, where a third consecutive rate cut is expected.

Thursday, September 5, 2024

• Australia: Reserve Bank Governor Michele Bullock is scheduled to speak in Sydney, which could provide insights into the central bank’s policy stance.
• United Kingdom: The London session sees the release of the UK Construction PMI data.
• United States: Significant US job updates include the ADP Non-Farms and weekly unemployment claims, followed by the ISM Services PMI, all of which will be closely monitored for clues on the Fed’s next moves.

Friday, September 6, 2024

• United States: The week’s highlight is the US Employment Situation Report, with key figures such as Non-Farm Payrolls, Average Hourly Earnings, and the Unemployment Rate set for release. These data points will be critical in shaping expectations for the Fed’s upcoming policy decisions. Later in the day, Fed members Waller and Williams are scheduled to speak, although the employment data is likely to dominate market sentiment.

This week’s events are pivotal, especially with potential implications for US monetary policy and market movements. Investors will be particularly attentive to the US labor data and the BoC’s rate announcement, which could set the tone for September’s trading environment.