Macroeconomic Horizon: European and American Sessions with Limited Impact

The European session today lacks significant economic events, limited to low-tier releases such as German factory orders or Eurozone retail sales. These data points will not change the ECB's stance on monetary policy, so market reactions will be muted. The focus remains on the upcoming ECB meeting, where a rate hike is widely expected but with less appetite for further tightening. This means higher thresholds for additional rate hikes. Turning to the American session, key events include Canada’s jobs report and the US Non-Farm Payrolls (NFP). Canada's employment change in August is forecasted at 15K compared to 75K prior, with an unchanged unemployment rate of 6.4%. While this data won't significantly influence the BoC's policy outlook, a very strong report could provide a boost to CAD following the more hawkish than expected rate decision. The US NFP is anticipated at 55K vs -23K prior, with the unemployment rate remaining unchanged at 4.1%, and average hourly earnings y/y expected at 3.1% from 3.2%. The CPI will be crucial as it decides whether the Fed hikes in September or stays put for another month. Market reactions are likely to remain limited if the US jobs data is inline with expectations, but a significant surprise either way could reprice interest rate expectations.

Source original: ForexLive (InvestingLive)