Welcome to “The Cyborg Analyst” by Prattle. This report provides weekly, quantitative insights on G-10 currency central banks.
The Most Important Central Bank Releases This Week
The RBA and RBNZ will almost certainly be this week’s biggest market movers among the G10 currency central banks. Although markets indicate that both banks may cut rates, Prattle data suggests that the RBA decision is a near tossup between either cutting or holding steady and signalling a rate cut in the near future. Several factors currently indicate that an immediate RBA rate cut is slightly more likely than a hold. Conversely, the RBNZ is more likely to hold rates this week, in part due to the new makeup of the Monetary Policy Committee.
Elsewhere, both the BOJ and Riksbank are issuing minutes from their most recent policy meetings, both of which were punctuated with dovish language. The BOJ minutes are likely to sound slightly dovish, while those of the Riksbank may sound more neutral. This week also brings speeches from Fed, ECB, BOE and BOC policymakers. Fed speakers will largely address local and regional economic issues rather than monetary policy, which suggests U.S. rates are likely to hold steady for the foreseeable future. The Bank of Canada will stick to more macro focused issues this week, with Governor Poloz likely to sound similarly neutral or slightly hawkish. Across the pond, BOE policymakers are somewhat less optimistic, despite favorable economic data, as Brexit risks continue to loom on the horizon. Those Brexit risks are less likely to dampen the tone of this week’s speeches from the ECB, where neutral or even slightly hawkish language could be prevalent.
This is an abbreviated version of the Cyborg Analyst. The full weekly report contains detailed analysis based on Prattle’s Central Bank Analytics.