It’s all going to be about wages…and Powell

Another terrible week for the Greenback. In fact, investors remained largely short on the US dollar amid growing perceptions of further easing by the Federal Reserve for the rest of this year and 2025. In addition, the likelihood of a soft landing in the US economy combined with the additional rate. cuts bode well for risk sentiment, remaining a lingering threat to any attempted dollar recovery.

The US Dollar Index (DXY) retreated for the third week in a row, this time hitting a new 2024 low just above the psychological level of 100.00. On September 30, the Chicago PMI will be held along with the Dallas Fed manufacturing index. The final S&P Global Manufacturing PMI comes on October 1st, followed by the ISM Manufacturing PMI, JOLTs Job Openings, Construction Spending and the API US Crude Oil Inventories report. ADP’s Employment Change takes center stage on October 2, backed by weekly Mortgage Loan Applications and the EIA’s US Crude Oil Supply report. On October 3, the usual weekly Initial Jobless Claims follow, followed by final S&P Global Services PMI, Factory Orders and ISM Services PMI. Wrapping up the week, non-farm payrolls take center stage on October 4, along with the unemployment rate.

EUR/USD advanced for the second week in a row, including a move to fresh 2024 highs beyond 1.1200, always amid improving risk complex and selling pressure in the US dollar. German import prices are due on September 30 along with the preliminary inflation rate. October 1st sees the final HCOB Manufacturing PMI for Germany and the Eurozone. Next up will be the Euro bloc unemployment rate on October 2, while the final German and bloc HCOB services PMI is expected on October 3, backed by EMU producer prices. On October 4, the HCOB Construction PMI is due for release in Germany and the Eurozone.

GBP/USD remained on a positive trajectory, advancing for the third week in a row and reaching levels last seen in March 2022 after 1.3430. UK current account results will be released on September 23, followed by the final Q2 GDP growth rate, business investment, mortgage approvals, mortgage lending and the BoE’s M4 money supply. The final S&P Global Manufacturing PMI is due on October 1st, while Nationwide Housing Prices is expected on October 2nd. October 3rd sees the final S&P Global Services PMI, and the S&P Global Construction PMI is scheduled for October 4th.

USD/JPY is on track for a third consecutive month of losses, all within the broader multi-week decline that began in July. Japanese industrial production, retail sales, housing starts and construction orders are all due on September 30. The unemployment rate, final Jibun Bank manufacturing PMI and BoJ Opinion Summary are expected on October 1, while the Tankan survey is in the spotlight. on October 2. Final Jibun Bank Services PMI comes on October 3, backed by weekly foreign bond investment figures.

An outstanding weekly performance saw AUD/USD break above the 0.6900 barrier for the first time since February 2023. Australian Housing Credit and Private Sector Credit results are due on September 30. The final PMI for Judo Bank manufacturing is scheduled for October 1, followed by preliminary Building Permits, Retail Sales and Approvals for Private Homes. The Ai Group survey is due on October 2, while the final Judo Bank Services PMI and Trade Balance figures will be due on October 3. Home loans and home investment loans are next in Oz on October 4th.

Anticipating the economic outlook: Voices on the horizon

• The Fed’s Powell and Bowman will speak on September 30 along with the ECB’s Lagarde and the BoE’s Greene.
• The Fed’s Bostic and Cook are scheduled to speak on Oct. 1, followed by the ECB’s Schnabel and Nagel and the BoE Pill.
• The Fed’s Barkin, Bostic, Collins, Bowman, Musalem and Hammack will speak on October 2, along with the ECB’s De Guindos, Buch, Elderson, Lane and Schnabel.
• Fed’s Bostic speaks Oct. 3.
• The Fed’s Williams is scheduled to speak on October 4, followed by the ECB’s Elderson, De Guindos and Buch.

Central Banks: Upcoming Meetings to Shape Monetary Policy

• The Polish Central Bank (NBP) meets on October 2.