Will they? Won’t they? – Fed rate rise

NZD - Inflation Expectations q/q: 2.1%
CHF - CPI m/m: -0.3%
USD - FOMC Member Kashkari Speaks

Markets continued to digest the extremely bullish labour data released on Friday. The better than expected Non-Farm Payrolls and unexpected drop in the headline Unemployment Rate has boosted bets that the Federal Reserve will raise rates at next month’s meeting. However, one figure stands in its way - US CPI which is scheduled for release this week. Vanguard and BlackRock expect inflation to reach the Fed’s target of 2%, citing a tight labour market and momentum in wage growth. If this reigns true the likelihood of a rate rise in September will rise dramatically.

In other news, markets kept an eye on OPEC’s meeting in Abu Dhabi yesterday. The meeting was chaired by Russia and Kuwait, intended to discuss poor compliance on the supply-cut agreement that began earlier this year. WTI briefly touched the key psychological level of $50, as the continued supply glut from OPEC nations and non-members continues and compliance issues between countries worsens.

EUR - German Trade Balance
EUR - French Trade Balance
USD - JOLTS Job Openings

The slow start of the week seen yesterday continues into today with only Trade Balances from Germany and France being released this morning. This will be followed by further Labour data from the US, where they will post the job opening positions.