Week’s main events March 23 – March 27)
In the fourth week of the conflict in the Persian Gulf, global markets remain hostage to geopolitics, as the virtual halt in energy exports from the region turns every economic report into a stress test. Investors in the US will focus on leading indicators, including the S&P PMI business activity index and consumer confidence data from the University of Michigan, which will be the first to reveal the depth of the shock caused by oil prices. At the same time, Europe, the UK, Japan, and Australia will release preliminary PMI data for March. For the eurozone, these figures will be a moment of truth, as the energy crisis is directly impacting manufacturing capacity. The week’s inflation agenda will be extremely packed: consumer price index (CPI) reports are expected in Japan, the UK, and Australia. Against this backdrop, the central banks of Norway and Mexico will make their monetary policy decisions, balancing the need to protect their national currencies with the need to restrain price pressures caused by global resource shortages.
The primary focus for Monday shifts to the Asia-Pacific region with Singapore’s Inflation Rate and a key policy speech from RBNZ Governor Anna Breman. Singapore’s annual inflation is forecast to decrease slightly from 1.4% y/y to 1.2% y/y recorded in January, while core inflation is expected to remain steady at 1.0%. Since the Monetary Authority of Singapore (MAS) recently indicated that inflation should average 1.0-2.0% in 2026, a result within this range is unlikely to trigger an immediate shift in the current “appreciating path” policy for the SGD. Late in the day, the NZD will be sensitive to a speech by RBNZ Governor Anna Breman, which has been recently updated to focus on the economic impacts of geopolitical conflicts and their potential to disrupt New Zealand’s growth and inflation trajectory. If Breman adopts a cautious or “dovish” tone regarding these external risks, it could signal a more hesitant approach to future rate hikes, putting downward pressure on the New Zealand Dollar (NZD).
- – Singapore Inflation Rate (m/m) at 07:00 (GMT+2) – SGD (MED)
- – New Zealand Gov Breman Speaks (m/m) at 22:00 (GMT+2) – NZD (LOW)
The most critical events for Tuesday are the Japan Inflation Rate and the global wave of Flash PMI data, which will provide a real-time health check on the world’s major economies. Japan’s annual inflation is forecast to decrease slightly from 1.5% to 1.3% y/y, while the Core Inflation Rate (which the BoJ watches closely) is expected to remain around 2.0%. A reading that exceeds these forecasts would increase the pressure on the Bank of Japan (BoJ) to follow up its recent rate hold with a hike in the coming months, likely providing significant support for the Japanese Yen (JPY). Conversely, a dip in inflation would suggest that the BoJ can afford to remain ultra-patient, potentially leading to Yen weakness against the USD.
In the West, the Eurozone and UK Manufacturing PMIs are forecast to hover near the 50.0 expansion/contraction threshold (Eurozone at 50.8 and UK at 51.7). If the Eurozone Services PMI beats forecast, it would signal that the region’s recovery is broadening, likely boosting the Euro (EUR). In the U.S., the preliminary US Services PMI (Flash Services PMI) is expected to decline from 51.7 to 50.4, indicating that high interest rates are beginning to weigh on the dominant U.S. services sector. This is likely to weaken the US dollar (USD), as it will reinforce expectations of more aggressive rate cuts by the Fed later this year.
- – Australia Manufacturing PMI (m/m) at 00:00 (GMT+2) – AUD (MED)
- – Australia Services PMI (m/m) at 00:00 (GMT+2) – AUD (MED)
- – Japan Inflation Rate at 01:30 (GMT+2) – JPY (HIGH)
- – Japan Manufacturing PMI (m/m) at 02:30 (GMT+2) – JPY (MED)
- – Japan Services PMI (m/m) at 02:30 (GMT+2) – JPY (MED)
- – Eurozone Manufacturing PMI (m/m) at 11:00 (GMT+2) – EUR (MED)
- – Eurozone Services PMI (m/m) at 11:00 (GMT+2) – EUR (MED)
- – UK Manufacturing PMI (m/m) at 11:30 (GMT+2) – GBP (MED)
- – UK Services PMI (m/m) at 11:30 (GMT+2) – GBP (MED)
- – US Manufacturing PMI (m/m) at 15:45 (GMT+2) – USD (MED)
- – US Services PMI (m/m) at 15:45 (GMT+2) – USD (MED)
- – Swiss SNB Chairman Schlegel Speaks at 19:00 (GMT+2) – CHF (LOW)
The most significant events for Wednesday are the UK Inflation Rate (CPI) and the Australia Inflation Rate, both high-impact releases that will dictate the near-term policy paths for the BoE and RBA. In the UK, annual inflation is forecast to hold steady at 3.0% for February, with core inflation also expected to remain unchanged at 3.1%. A reading that meets or exceeds these levels would signal that price pressures are proving stickier than expected, likely providing a boost to the British Pound (GBP) as markets price out the possibility of early rate cuts. In Australia, the annual CPI indicator for February remains at 3.8% following a recent surge in consumer inflation expectations to 5.2%. If the actual data confirms this data, it will likely strengthen the Australian Dollar (AUD) by reinforcing expectations for further RBA rate hikes or a prolonged hold at cycle highs. Finally, for commodity traders, a larger-than-expected build in US Crude Oil Reserves (forecasted at +2.1M barrels) could exert downward pressure on WTI Crude. However, the impact may be muted by ongoing geopolitical supply concerns.
- – Japan Monetary Policy Meeting Minutes at 01:50 (GMT+2) – JPY (MED)
- – Australia Inflation Rate (m/m) at 02:30 (GMT+2) – AUD (HIGH)
- – UK Inflation Rate (m/m) at 09:00 (GMT+2) – GBP (HIGH)
- – Eurozone ECB President Lagarde Speaks at 10:45 (GMT+2) – EUR (LOW)
- – German Ifo Business Climate (m/m) at 11:00 (GMT+2) – EUR (MED)
- – US Crude Oil Reserves (w/w) at 16:30 (GMT+2) – WTI (HIGH)
The most significant events for Thursday are the Norges Bank Interest Rate Decision and the Mexico (Banxico) Interest Rate Decision, as they represent critical policy pivots amid persistent inflation and geopolitical uncertainty. Norges Bank is widely expected to keep its policy rate steady at 4.00%, as the committee has signaled it is in “no hurry to cut” despite a cooling economy. A hold accompanied by a hawkish statement emphasizing sticky core inflation would likely support the Norwegian Krone (NOK). Meanwhile, the Bank of Mexico is also expected to hold its benchmark rate at 7.00%, though the market is split. A surprise 25-basis-point cut, as some analysts forecast, due to weak economic activity, would likely lead to a sell-off in the Mexican Peso (MXN).
In contrast, a hold would reinforce the currency’s “higher-for-longer” carry trade appeal. In the United States, Initial Jobless Claims are forecast to land around 209K, following a series of lower-than-expected readings that suggest a very tight labor market. If the actual number comes in significantly higher, it would signal a long-awaited cooling in employment, potentially weighing on the US dollar (USD) by fueling expectations for Fed easing. For energy traders, the US Natural Gas Storage report (forecasting a seasonal withdrawal) remains the primary driver of XNG – a smaller-than-expected draw would likely cap recent price gains.
- – Germany GfK Consumer Confidence (m/m) at 09:00 (GMT+2) – EUR (MED)
- – Norway Norges Bank Interest Rate Decision at 11:00 (GMT+2) – NOK (HIGH)
- – US Initial Jobless Claims (w/w) at 14:30 (GMT+2) – USD (MED)
- – US Natural Gas Storage (w/w) at 16:30 (GMT+2) – XNG (HIGH)
- – Mexico Interest Rate Decision (m/m) at 21:00 (GMT+2) – MXN (HIGH)
- – UK Retail Sales (m/m) at 09:00 (GMT+2) – GBP (MED)
- – Mexico Unemployment Rate (m/m) at 14:00 (GMT+2) – MXN (MED)
- – US Michigan Consumer Sentiment (m/m) at 16:00 (GMT+2) – USD (MED)
by , 2025.03.23