Following a pivotal Federal Reserve meeting, investors will now turn their attention to a fresh set of US economic data to assess whether the world's largest economy remains resilient enough to support the Fed's higher-for-longer stance.
Friday's Non-Farm Payrolls report will be the week's headline event. Economists expect the US economy to add around 79,000 jobs in July after a gain of 57,000 in June, while the unemployment rate is forecast to remain steady at 4.2%. Another resilient labour market report could reinforce expectations that the Federal Reserve has little urgency to begin cutting interest rates.
Ahead of Friday's release, markets will also closely monitor JOLTS job openings and the ISM manufacturing and services PMIs for additional insight into hiring trends and business activity across the US economy.
Our focus this week will be on Alpari's USDInd, which may be preparing for a larger breakout move as investors reassess the outlook for US monetary policy.
US labour market in focus
Markets will focus on a series of key US economic releases next week as investors assess the strength of the labour market and broader economic activity following the latest Federal Reserve meeting. Chinese trade data and Canada's employment report will also be closely watched for fresh clues on global growth.
Monday, August 3rd: US ISM Manufacturing PMI
The manufacturing PMI will provide an update on business activity in the US industrial sector. A stronger reading could reinforce expectations that economic momentum remains resilient.
Tuesday, August 4th: US JOLTS Job Openings
Job openings data will offer an early snapshot of labour demand ahead of Friday's payrolls report. Signs of a cooling jobs market could influence expectations around future Federal Reserve policy.
Wednesday, August 5th: US ISM Services PMI
The services sector remains the largest driver of US economic activity. Investors will watch the report for fresh signals on business conditions and domestic demand.
Friday, August 7th: US Non-Farm Payrolls and Unemployment Rate
The US employment report will be the week's key event. Investors will assess whether hiring has picked up from June and whether the unemployment rate remains stable, with the results likely to have a significant impact on expectations for future Federal Reserve policy.
Friday, August 7th: Canada Unemployment Rate
Canada's labour market report may shape expectations around future Bank of Canada policy decisions and drive volatility in the Canadian dollar.
Sunday, August 9th: China CPI
China's inflation report will provide a fresh reading on domestic demand and price pressures in the world's second-largest economy, with potential implications for global risk sentiment and commodity markets.