Economic calendar: FOMC decision day

Summary

- FOMC to make interest rate decision today
- Slowdown in the European economy expected to have continued in Q2
- ADP estimates to provide final check ahead of NFP release

10:00 am BST - Euro area, GDP for Q2 and CPI inflation for July. European economy continued to struggle in the second quarter of the year. Moods are clearly downbeat as hinted by lacklustre PMI readings. The question remains whether such deterioration will be reflected in the GDP report for Q2. Preliminary figures are expected to show a slowdown from 1.2% YoY to 1% YoY. Simultaneously, preliminary CPI report for July will be released and it is expected to show headline CPI slowing from 1.3% YoY to 1.1% YoY.

1:15 pm BST - US, ADP employment report for July. The NFP report for July is scheduled to be released on Friday. ADP will release employment change estimates today and it will be the final check ahead of the official labour market report. An increase of 150k is expected, more or less in line with the average for this decade.

1:30 pm BST - Canada, GDP report for May. Canadian central bank is on a stand-by as it weighs deteriorating conditions in the global economy against not so bad domestic data. While Canada is not experiencing declining output, industrial production growth has slowed significantly this year. Markets expects Canadian economic growth to slow from 1.5% YoY in April to 1.3% in May.

3:30 pm BST - DOE report on oil inventories. API report released yesterday showed another major decline in the crude inventories (-6 mb). Oil prices caught a bid and pushed higher. Now the attention shifts to the official report of the US Department of Energy. Market consensus points to 2.6 mb decline but one should keep in mind that last week’s DOE report nearly matched a drop hinted by API estimates.

7:00 pm BST - FOMC interest rate decision. Key point in this week’s calendar is FOMC meeting. The US central bank is expected to deliver a 25 bp rate cut and may provide investors with a guide on what it will do next. Will there be more “insurance cuts”? Investors shall get an answer during the press conference of the Chairman Powell (7:30 pm BST). Traders should keep in mind that there is a high chance of volatility spikes occurring during the conference. 

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