This week, the central bank torch will be passed to the RBA, with the market assigning a 74% chance for a rate cut. Thus, if indeed policymakers decide to cut rates, focus will quickly turn on whether they will stay willing to deliver more cuts in the months to come. From the Eurozone, we get the preliminary CPIs for September, where another set of soft prints may increase the need for more monetary and fiscal support. In the US, the employment data for the month are due to be released, where a decent report may prompt investors to push somewhat back their bets with regards to another Fed cut this year.
On Monday, during the European morning, we get the final UK GDP for Q2, which is expected to confirm that the British economy contracted 0.2% qoq in the three months to June. That said, we expect the release to pass largely unnoticed as we already have data pointing to how the economy entered the third quarter. The monthly GDP rate for July rose to +0.3% mom from 0.0% mom, easing fears with regards to a technical recession.
GBP traders may keep most of their attention on the political scene. On Sunday, the Conservative Party Conference has begun, and it will last until Wednesday. Last week, UK PM Boris Johnson said that he will respect the law requiring him to seek for a new delay, but he will take the UK out of the EU on October 31st. The only way this could happen is for him to reach...
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