On Wednesday, five major events hit the foreign exchange market between 1:30 a.m. and 7:30 p.m. On Thursday, the ECB takes over, and on Friday the Bank of Japan brings up the rear. This Monday morning, the market is already positioning itself: the New Zealand dollar is recovering against the dollar, supported by bets on a rate hike in Wellington.
In brief
The Fed announces its decision on Wednesday at 7:00 p.m. Paris time. The Edgyx economic calendar expects rates to remain unchanged at 4.00%, while market expectations for an October hike have fallen sharply, according to FXStreet.
On Thursday at 1:30 p.m., U.S. GDP (3.2% expected) and core PCE inflation (0.3% expected month over month) are released 45 minutes before the ECB, which is expected to hold rates steady.
The cycle has changed direction
This week, the question is about rate hikes, not cuts. The Fed tightened in September.
The hawks' arguments are well known. The September price index rose 0.6% month over month, and 0.3% excluding food and energy. The firm expects core PCE to rise 0.3%, after three months at 0.2% or lower. On Friday, the University of Michigan survey showed household inflation expectations steady at 4.7%.
A useful detail for your plan: according to Continuum, Kevin Warsh, who is hostile to forward guidance, would provide little insight into December. Every word of the press conference will be scrutinized.
In Europe, the picture is different. The PMIs released on Friday disappointed in France: 48.4 for services, versus 50.7 expected. Economists cited by FXStreet expect the ECB to remain on hold, with Christine Lagarde keeping all options open. A Fed in tightening mode facing an ECB on hold: that is the backdrop for EUR/USD this week.
The day-by-day schedule
First, a potential trap. Europe switched to winter time on Sunday, but the United States has not yet. U.S. figures will therefore be released at 1:30 p.m. and the Fed decision at 7:00 p.m., one hour earlier than usual. Check your alerts.
| Day | Time (Paris) | Event | Forecast | Previous |
|---|---|---|---|---|
| Tuesday 27 | 3:00 p.m. | Conference Board consumer confidence (USD) | 80.5 | 81.9 |
| Wednesday 28 | 1:30 a.m. | Australian inflation year over year (AUD) | 4.2% | 4.0% |
| Wednesday 28 | 2:00 a.m. | RBNZ policy rate (NZD) | 3.00% | 2.75% |
| Wednesday 28 | 1:30 p.m. | UK budget (GBP) | — | — |
| Wednesday 28 | 2:45 p.m. | Bank of Canada policy rate (CAD) | — | 2.25% |
| Wednesday 28 | 7:00 p.m. | Fed policy rate (USD) | 4.00% | 4.00% |
| Thursday 29 | 1:30 p.m. | U.S. GDP, first estimate (USD) | 3.2% | 1.5% |
| Thursday 29 | 1:30 p.m. | Core PCE month over month (USD) | 0.3% | 0.2% |
| Thursday 29 | 2:15 p.m. | ECB refinancing rate (EUR) | 2.65% | 2.65% |
| Friday 30 | 12:30 a.m. | Tokyo core inflation year over year (JPY) | 2.6% | 2.7% |
| Friday 30 | 3:30 a.m. | Bank of Japan policy rate (JPY) | < 1.25% | < 1.25% |
| Friday 30 | 1:30 p.m. | Employment Cost Index (USD) | 0.8% | 0.9% |
Tuesday is the warm-up, with U.S. household confidence, followed by the Canadian federal budget at 9:03 p.m.
Wednesday contains most of the action. Overnight, Australia and the RBNZ. At 1:30 p.m., the Chancellor of the Exchequer presents his autumn budget to the House of Commons. At 2:45 p.m., the Bank of Canada and its quarterly report. At 7:00 p.m., the Fed.
Thursday may force a reassessment of Wednesday's message. The Fed makes its decision without knowing the September PCE data. If core PCE exceeds 0.3%, the market could interpret the previous day's statement more hawkishly. The ECB follows at 2:15 p.m., with the press conference at 2:45 p.m.
Friday unfolds overnight for the yen, with the Bank of Japan at 3:30 a.m. Preliminary German inflation follows at 7:29 a.m. (0.1% expected month over month, after 0.6%).
The currencies on the front line
The kiwi and aussie, on the same night
investingLive puts the probability of a third consecutive hike, after July and September, at around 90%, just ten days before the election. Yet uncertainty remains: third-quarter inflation came in at 3.7% year over year, below the 3.8% expected, Newsquawk notes. On the charts, FXStreet identifies initial resistance on NZD/USD.
Half an hour earlier, Australian inflation carries twice the weight: according to Newsquawk, the market assigns roughly equal odds to an RBA hike or a hold on November 3. Inflation above the expected 4.2%, followed by a cautious RBNZ, could jolt AUD/NZD in the middle of the European night. Check the measured impact of Australian CPI to calibrate your stops.
The loonie and pound, on the same afternoon
USD/CAD absorbs two decisions within four hours: the Bank of Canada at 2:45 p.m., and the Fed at 7:00 p.m. With a Canadian hike expected, the tone of the quarterly report will make the difference.
The pound arrives weakened. UK retail sales fell 0.4%, versus 0.1% expected, even though the services PMI surprised at 53.1. Wednesday's budget will first be reflected in gilt yields, then in GBP/USD.
Yen, gold, indices, crypto
USD/JPY faces the Fed on Wednesday evening and the Bank of Japan before dawn on Friday. Gold, U.S. indices and bitcoin react primarily to real rates: a more hawkish-than-expected Fed would weigh on all three. Political risk is not taking a holiday either. This Monday, during the Tokyo session, a Brazilian ETF plunged nearly 15% after Lula won the runoff.
Your plan, written before the announcement
At 7:01 p.m. on Wednesday, it will be too late to think. Spreads widen, stop orders slip, and the first candle often lies. Decide now:
- Which events affect your instruments. An EUR/USD trader can ignore the RBNZ, but not the Fed and ECB, which are less than twenty hours apart.
- What you will do with your open positions. Close them, keep them with a wider stop, or reduce position size.
- Your entry rule after the announcement. For example, no entry before the first fifteen-minute candle closes.
- Your prop firm's rules. Many firms restrict trading around high-impact announcements. Review them before Wednesday, not after a violation.
Reducing position size costs almost nothing. Failing to reduce it can be expensive.
The journal, the week it matters most
Before each announcement, write down three lines: the expected figure, the scenario that would make you act, and what you will do if nothing goes as planned. Afterwards, record what actually happened and whether you followed your plan.
Tag every trade taken within an hour of an announcement. In a month, compare these trades with the others: average gain, average loss, and adherence to your stop. If you keep your journal in Edgyx, the calendar displays the measured impact of each release, and Ora can match your trades with the announcements around them.
A week with five central banks does not reward the trader who guesses. It rewards the trader who decided in advance.
Key takeaways
- Wednesday is the key day: Australian inflation, the RBNZ, the UK budget, the Bank of Canada and the Fed, from 1:30 a.m. to 7:30 p.m.
- The market expects the Fed to remain at 4.00% but stay hawkish, with hikes in Canada and New Zealand.
- Thursday's PCE at 1:30 p.m. could change how the market reads the Fed, just before the ECB.
- Reduce your risk per trade, write your plan before the announcement and tag event-driven trades in your journal.
