Amid anticipation of the upcoming US FOMC meeting and Chairman Powell’s press conference, today’s market is expected to be sluggish. However, several employment-related indicators are scheduled for release, including the US ADP Employment Change (January) and the US Employment Cost Index (4th Quarter 2023). Additionally, the US Chicago Purchasing Managers’ Index (PMI) (January) and the US MBA Mortgage Applications (01/20 – 01/26) are on the calendar.
Yesterday, US job openings unexpectedly showed strength at 9.026 million. Moreover, the Conference Board Consumer Confidence exceeded both previous readings and expectations, coming in at 114.8. If today’s US indicators display a similar trend, it could lead to a stronger US dollar as we approach the FOMC meeting.
In addition to the mentioned US indicators, economic data from overseas markets includes the UK Nationwide House Price Index (January), Germany Retail Sales (December), Germany Employment Statistics (January), Germany Consumer Price Index (Flash) (January), Switzerland Retail Sales (December), Hong Kong Real GDP (Advance) (4th Quarter 2023), Canada Real GDP (November), and Brazil’s Central Bank Policy Rate.
The market consensus for the FOMC is to keep the policy rate unchanged. The focus will likely shift to Chairman Powell’s press conference. Given the recent strength in US economic indicators, there is a strong likelihood that market expectations of a rate cut in March will be strongly denied. If there is any hint of additional rate hikes as the next action, it could trigger a widespread rally in the US dollar.
Regarding speaking events, the Powell press conference will take center stage. There don’t appear to be any notable speeches or events by financial authorities. Attention will also be on the release of the US Weekly Petroleum Inventory statistics and earnings reports from US companies such as Boeing, Qualcomm, and MasterCard.
Today’s primary focus is undoubtedly the FOMC meeting. Various speculations are circulating, but the actual outcome remains uncertain. If significant developments emerge from the FOMC meeting, there is a high likelihood that the market will continue to react in subsequent sessions. For those who can’t monitor the news in real-time, it’s advisable to wait, observe the market’s reaction, and then make informed decisions.
The USDJPY long position from yesterday has already been stopped out at the entry price, and I currently have no positions.