Week’s main events (May 26 – May 30)

Market volatility is expected to remain subdued this week, with investors primarily focused on inflation data. The Reserve Bank of New Zealand meets early on May 28 and is expected to cut its cash target rate by a quarter-point to 3.25%. In the United States, the release of the Personal Consumption Expenditures (PCE) Price Index will be closely monitored, as FOMC policymakers regard it as a more precise measure of inflation compared to the CPI report. While a modest uptick is anticipated, markets have largely priced in this expectation, limiting its potential impact on volatility. Germany and Australia will also publish inflation reports, with ongoing signs of declining inflationary pressures. Meanwhile, Tokyo’s inflation data, set for release on Friday, will be of particular interest as market participants assess potential shifts in the Bank of Japan’s monetary policy stance.

Monday, May 26

Monday is anticipated to be a low-volatility trading day due to public holidays in the UK and the US. During the Asian session, market participants will likely focus on Hong Kong’s trade balance data. Significant market-moving news is not expected.

Main events of the day:

– Hong Kong Trade Balance (m/m) at 11:30 (GMT+3);
– Eurozone ECB President Lagarde Speaks at 17:30 (GMT+3).

Tuesday, May 27

Tuesday’s key economic release will be the Durable Goods Orders report, which provides insight into business investment trends. This data is typically subject to revisions, with the Factory Orders report, published approximately one week later, offering a more refined assessment. Overall, market volatility is expected to remain muted throughout the day.

Main events of the day:

– Switzerland Trade Balance (m/m) at 09:00 (GMT+3);
– German GfK Consumer Climate (m/m) at 09:00 (GMT+3);
– US Durable Goods Orders (m/m) at 15:30 (GMT+3);
– US CB Consumer Confidence (m/m) at 17:00 (GMT+3);
– Switzerland SNB Chairman Schlegel Speaks at 19:20 (GMT+3).

Wednesday, May 28

Wednesday is expected to bring heightened market activity, with several key events scheduled across major regions. During the Asian trading session, investors will closely examine Australia’s inflation data alongside the Reserve Bank of New Zealand’s (RBNZ) interest rate decision. Australian year-over-year consumer price inflation is expected to edge down from 2.4% to 2.3%, reinforcing the disinflation trend. The RBNZ is anticipated to reduce its policy rate by 25 basis points, with market pricing in a terminal rate in the range of 2.75% to 3.00%. Later in the day, attention will shift to the release of the minutes from the latest Federal Open Market Committee (FOMC) meeting, during which the US Federal Reserve maintained its benchmark rate at 4.5%. Market response to the minutes is expected to be muted, given the widely anticipated decision and limited forward guidance.

Main events of the day:

– Australia Consumer Price Index (m/m) at 04:30 (GMT+3);
– New Zealand RBNZ Interest Rate Decision at 05:00 (GMT+3);
– New Zealand RBNZ Rate Statement at 05:00 (GMT+3);
– New Zealand RBNZ Press Conference at 06:00 (GMT+3);
– German Unemployment Rate at 10:55 (m/m) (GMT+3);
– US Richmond Manufacturing Index (m/m) at 17:00 (GMT+3);
– US FOMC Meeting Minutes at 21:00 (GMT+3).

Thursday, May 29

On Thursday, market participants will closely monitor the release of preliminary US GDP data, which is projected to indicate negative 0.3% quarterly, sharply down from positive 2.4% in the previous period. A weaker-than-expected data could provide pressure on the US dollar. Additionally, energy market traders will analyze updates on crude oil and natural gas inventories. An increase in stockpiles may exert downward pressure on these commodities, reflecting potential shifts in supply-demand dynamics.

Main events of the day:

– New Zealand ANZ Business Confidence (m/m) at 04:00 (GMT+3);
– Japan Consumer Confidence (m/m) at 08:00 (GMT+3);
– US Initial Jobless Claims (w/w) at 15:30 (GMT+3);
– US GDP (q/q) at 15:30 (GMT+3);
– US Pending Home Sales (m/m) at 17:00 (GMT+3);
– US Natural Gas Storage (w/w) at 17:30 (GMT+3);
– US Crude Oil Reserves (w/w) at 18:00 (GMT+3);
– UK BOE Gov Bailey Speaks at 22:00 (GMT+3).

Friday, May 30

Friday’s market activity is expected to be significantly influenced by two major inflation reports. The most critical release will be the US Personal Consumption Expenditures (PCE) Price Index. This data is a preferred inflation gauge for the Federal Reserve and is closely monitored for its implications on monetary policy adjustments. While a month-on-month increase of 0.1% is anticipated, this expectation may already be priced into the market, potentially limiting any significant positive impact on the US dollar. Traders should be prepared for increased volatility around this release, as deviations from expectations could trigger notable market reactions. Traders should also pay close attention to the Tokyo inflation report, which serves as a crucial leading indicator for nationwide inflation trends in Japan. Economists are expecting a year-on-year increase from 3.4% to 3.5%. A stronger-than-expected reading could positively impact the Japanese yen, as it would likely reinforce expectations for further interest rate hikes from the Bank of Japan.

Main events of the day:

– Japan Tokyo Core CPI (m/m) at 02:30 (GMT+3);
– Japan Unemployment Rate (m/m) at 02:30 (GMT+3);
– Japan Retail Sales (m/m) at 02:50 (GMT+3);
– Japan Industrial Production (m/m) at 02:50 (GMT+3);
– Australia Retail Sales (m/m) at 04:30 (GMT+3);
– German Retail Sales (m/m) at 09:00 (GMT+3);
– Switzerland KOF Leading Indicators (m/m) at 10:00 (GMT+3);
– German Inflation Rate (m/m) at 15:00 (GMT+3);
– Canada GDP (m/m) at 15:30 (GMT+3);
– US Core PCE Index (m/m) at 15:30 (GMT+3);
– US Chicago PMI (m/m) at 16:45 (GMT+3);
– US Revised UoM Inflation Expectations (m/m) at 17:00 (GMT+3);

by JustMarkets, 2025.05.26

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