Week ahead
Week of 28 September: PCE, payrolls and an RBA decision
The week's scheduled events for forex traders. An RBA decision on Tuesday, US PCE inflation on Wednesday, ISM on Thursday, US payrolls and eurozone inflation on Friday, and what each one means under the challenge rules.
This is the busiest week of data since the Federal Reserve raised rates on 16 September. A central bank decision, three CPI releases, final GDP and the US jobs report all land between Tuesday and Friday, and each of those is on the list of high-impact events in our rules. Wednesday is also the last day of the quarter. Below is what is scheduled, what markets expect, and what each event means on a challenge account. This is a calendar, not a forecast: we do not say which way anything will move.
Where the week starts
Friday's close left EUR/USD at about 1.139, gold at about $4,320 an ounce and Brent at about $104. The Fed's target range is 3.75% to 4.00%, and markets are pricing a high chance of another hike at the 28 October meeting. That is why every inflation and jobs number this week will be read as a clue to the Fed's next move.
The calendar
| Day | Event | Previous | Consensus |
|---|---|---|---|
| Tue 29 Sep | RBA rate decision | 4.35% | 4.60% (a 25 bp hike) |
| Tue 29 Sep | US JOLTS job openings, August | 7.27 million | about 7.23 million |
| Wed 30 Sep | Australia CPI, August, m/m | 1.0% | 0.5% |
| Wed 30 Sep | US core PCE price index, August, m/m | 0.2% | 0.3% |
| Wed 30 Sep | US ADP private payrolls, September | - | about 70,000 |
| Thu 1 Oct | US ISM manufacturing PMI, September | - | - |
| Fri 2 Oct | Eurozone flash CPI, September, y/y | 3.2% | 3.7% |
| Fri 2 Oct | US nonfarm payrolls, September | 162,000 | about 100,000 |
| Fri 2 Oct | US unemployment rate | 4.1% | 4.1% to 4.2% |
Several Fed speakers are also on the schedule through the week, as are ECB President Lagarde on Monday, final US GDP for the second quarter on Wednesday and Tokyo CPI on Friday.
Tuesday: the RBA
Markets price a 25 basis point hike by the Reserve Bank of Australia as close to certain, which would take the cash rate to 4.60%, its highest since 2011. The decision comes during the Asian session. When a move is fully expected, the reaction often comes from the statement rather than the decision itself, so AUD pairs can move in either direction after the announcement.
Wednesday: PCE and quarter end
PCE is the Fed's preferred inflation measure. Core PCE is expected to rise 0.3% in August after 0.2% in July. Wednesday is also 30 September, the end of the month and the quarter, when large portfolio flows can move currencies around the London fix. On many instruments, Wednesday's rollover also carries the triple swap for the weekend (Challenge Rules 6.6).
Friday: payrolls and eurozone inflation
The September jobs report is due at 8:30 a.m. New York time, which is 12:30 server time. Consensus is for about 100,000 new jobs after 162,000 in August. A few hours earlier, the eurozone flash inflation estimate is expected to show a jump to 3.7% from 3.2%. With two major releases on one day, EUR/USD and gold can see two separate bursts of volatility before the weekend.
What the week means on a challenge account
- News trading is allowed, with limits. You may open, modify or close positions around scheduled announcements. The company may restrict trading shortly before, during or right after high-impact events, and payrolls, CPI releases and central bank decisions are all on that list. Any restrictions and restricted event lists are published in your dashboard (Challenge Rules 6.5). Check it before Tuesday.
- No bracketing the release. Placing a buy stop and a sell stop around a release to catch the first spike in either direction is news bracketing, and it is prohibited (Challenge Rules 7.2(a)). A position based on your own view of the market is fine.
- Size against the day, not the balance. On a $50,000 Sprint the daily room is $2,000. A $30 move in gold is $3,000 on one lot, and a release can move more than that in minutes. See why 1% risk is a quarter of your day.
- Spreads and slippage count. Around releases and at rollover, spreads can widen and fills can slip. Both go into floating equity, which is what the daily limit watches (Challenge Rules 6.8).
- Know when your day resets. The platform runs on UTC server time. The starting day balance is set at 00:00, and the rollover period runs from about 23:55 to 00:15, when trading is allowed but execution can be worse (Challenge Rules 6.7). Late in the week, a position close to the floor at 23:55 is at its most exposed. See how the daily drawdown limit works.
- The weekend comes right after payrolls. Positions can be held over the weekend, and the daily limit applies on weekends too (Challenge Rules 6.6). A gap at Monday's open counts like any other move.
Next
On Friday after the close we will look back at how the week actually played out.
This article is market commentary for information only. It is not a forecast, a recommendation or financial advice, and prices are approximate, taken from public market reports at the time of writing. VFUNDED provides simulated trading evaluations: trading activity is simulated and performance rewards are not guaranteed.