On Wednesday (21:00 GMT+3), the Federal Reserve will announce its interest rate decision. Analysts' opinions are divided. Some believe that the surge in bond yields signals that the Fed will likely keep the rate at 5.5%. Others say strong GDP and PCE data released on Friday strengthened the case for the Fed to keep rates higher for an extended period. Therefore, one more rate hike may occur before this tightening cycle is over. The hawkish tone of the central bank may contribute to the growth of the US dollar and decline in the S&P 500 index, which has fallen over 10% since late July when it reached a one-year-high.
On Friday (15:30 GMT+3), American labour market data will be released. Last month, the NFP release reflected the strongest job gain in eight months. This month, analysts forecast a more moderate growth, but it’s still consistent with a robust labour market, while the unemployment rate should remain unchanged. If the data disappoints market participants, the US dollar may weaken.
On Thursday (after the bell), Apple's (AAPL) earnings report will be out. The company's shares have surged around 29% this year. AAPL stock has heavy weighting in the Nasdaq and S&P 500 indices, and it has the potential to take the market in one particular direction. Demand updates on the new iPhone 15 will be closely monitored by market participants.
On Thursday (15:00 GMT+3), the Bank of England will announce its interest rate decision. Although the BoE is expected to maintain the existing 5.25% rate, comments from the Bank will be critical. Analysts believe policymakers will once again claim the rates should remain at current levels for some time despite growing signs that the economy is stabilising. Any comments on future rate hikes may support the growth of the British pound.
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