This week's macroeconomic calendar will be influenced by geopolitical developments, particularly from the Middle East, alongside scheduled data releases. Weekend updates regarding potential US-Iran agreements could trigger active market movements at the Asian open on Monday. Despite limited scheduled events due to bank holidays in major European and North American markets, liquidity constraints may lead to significant volatility, especially in oil, gold, and the US dollar.
Tuesday sees a return to normal trading with a focus on US Consumer Confidence data released shortly after the New York open. The figure is expected to show a slight decline from the previous month's 92.8.
Wednesday is data-heavy during the Asian session. Speeches from Bank of Japan Governor Uchida and Australian CPI data will be key. The Australian CPI is forecast at 0.6% month-on-month, down from 1.1%, with the year-on-year rate expected to dip to 4.4% from 4.6%. This follows last week's softer employment figures. The main central bank event is the Reserve Bank of New Zealand's policy decision, where rates are expected to hold at 2.25%, accompanied by a likely hawkish tilt in the accompanying statement and press conference. The European session is quieter, featuring the ECB's Financial Stability Review and speeches from Fed officials.
Thursday is a critical day for US data. The Core PCE Price Index, the Fed's preferred inflation gauge, is expected to rise 0.3% month-on-month. Preliminary Q1 GDP is forecast at 2.1% quarter-on-quarter, a significant increase from 0.7%. Other releases include weekly jobless claims, new home sales, and Canadian financial system review remarks. US crude oil inventory data will also be released.
Friday concludes with important data across all sessions. The Asian focus is Japan's Tokyo Core CPI, expected at 1.5% year-on-year, which may drive Yen volatility. The European session features Germany's preliminary CPI, forecast at 0.2% month-on-month, and a speech from Bank of England Governor Andrew Bailey. The New York session includes Canadian monthly GDP data and remarks from several Federal Reserve members.
Geopolitical news, especially regarding Middle East tensions, is expected to be a primary market driver throughout the week. Any resolution could pressure oil prices and the US dollar while easing inflation expectations. With June approaching, significant price swings are possible across all asset classes. As always, trade cautiously and manage risk appropriately.
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