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Fed remain hawkish ahead of this week’s NFP

  • MPC Member Cunliffe Speaks
  • FOMC Member Tarullo Speaks
  • FOMC Member Dudley Speaks
  • US Core PCE Price Index m/m: 0.1%
  • US Personal Spending m/m: 0.4%
  • US Pending Home Sales m/m: -1.4%
  • FOMC Member Evans Speaks
  • FOMC Member Williams Speaks

Yesterday, markets were treated to both key US data and Federal Reserve commentary as economists’ continue to speculate on interest rate expectations. Last week several FOMC members including the Fed Chair Janet Yellen suggested that a rate rise could occur in 2015. Focus surrounded FOMC member Dudley, a ‘centrist’ of the committee and a member who is the most influenced by financial market fluctuations. Dudley continued the Fed’s hawkish tone whilst re-iterating that he remains very data dependant.

On other news, rumours that Anheuser-Busch could bid about $106 billion for SABMiller within days, with an opening offer expected anytime this week. The world’s two biggest brewers have begun talks and a deal is imminent, according the Sunday Times. Rumours of this monumental acquisition sparked Sterling strength yesterday morning.

As concerns of China’s slowdown continues to be seen as commodity prices are still being pushed lower, a risk aversion was seen in yesterdays trading against the Asian markets.  This has prompted a flight to safety to the Euro and Yen, as investors came out of riskier assets after news yesterday that Chinese profits slumped in August.  The single currency is now trading near four month highs against the Pound as a result of this flight to safety move. 

  • German Prelim CPI m/m
  • Spanish Flash CPI y/y
  • UK Net Lending to Individuals m/m
  • US Goods Trade Balance
  • US CB Consumer Confidence
  • BoE Gov Carney Speaks
  • NZD ANZ Business Confidence
  • AUD Building Approvals m/m

Key numbers and events from the UK today. The UK’s lending numbers and CBI realised sales numbers are set for release which will give the market an indication of spending. Meanwhile, BoE Governor is due to speak at Lloyds of London. Volatility is often experienced during his speeches as the market attempts to decipher interest rate clues. Currently the market is starting to taper back their expectation of a hike in Feb. In the US the consumer confidence is expected to slide given the economic backdrop.