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Market focus: FOMC meeting minutes, RBNZ rate statement, and Canada CPI 


What happened in the market last week?

  • Investors were closely monitoring the FOMC meeting minutes released by the Federal Reserve.
  • Despite the recent run of strong data, most Fed members voted for a 25bps increase instead of 50, which was seen as more likely.
  • The US data continued to highlight the need for the Fed to either hike rates more aggressively or for longer.
  • The Flash Services PMI came in at 50.5, surpassing the previous figure of 46.8.
  • The Core PCE Price Index m/m also increased from the previous figure to 0.6%.
  • The USD strengthened over the last week as investors anticipate the Fed’s rate hike decision.
  • The Reserve Bank of New Zealand (RBNZ) raised its interest rates from 4.25% to 4.75%. 
  • RBNZ expects to hike rates further as employment remains above a sustainable level while inflation stays high.

Chart, bar chart

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Source: VT Markets MT4

Last Week Market Pair Changes 

(All data taken from MT4 VT Markets)

The USD received a boost last week due to robust data from the US.

  • The USDJPY rose by 1.71%.
  • The USD Index rose by 1.31%.
  • The EURUSD was lower by 1.29%
  • The GBPUSD was lower by 0.71%.
  • The worst performance for US indices last week was seen in the DJ30 and NAS100, which both closed lower by 2.94% and 2.96%, respectively.
  • Gold fell by 1.61%.
  • USOUSD (WTI) dropped by 0.37%.

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Source: VT Markets Economic Calendar

What to focus on this week?

This week, the markets will be watching closely as two of the most influential economic indicators – US ISM Manufacturing and Services PMI figures – are released. With these reports being used to measure overall health of the US economy, the results could have a dramatic effect on financial markets worldwide. This makes them an essential area for market participants to keep tabs on.

Here are key events to watch out for:

Gross Domestic Product | Canada (28 February)

The Canadian economy continued its upward trend in Q3 2022, growing by 0.7%, marking the fifth consecutive quarter of growth. 

Analysts predict that the economy will continue to grow and expand by 0.4% in Q4 2022.

CB Consumer Confidence | US (28 February)

The Consumer Confidence Index fell from 109 in December to 107.1 in January 2023, according to the Conference Board. 

However, analysts anticipate a possible recovery in the index, with a projected increase to 109 in February.

Consumer Price Index (CPI) | Australia (1 March)

The Consumer Price Index in Australia increased to a new high of 8.4% in December 2022, up from 7.3% in November. 

Analysts predict that the Australian CPI will continue to rise, with an 8.6% increase projected for January 2023.

ISM Manufacturing Purchasing Managers’ Index | US (1 March)

The US ISM Manufacturing PMI fell to 47.4 in January 2023, the lowest level since May 2020. 

Analysts predict a slight rebound in the PMI for February, with a reading of 47.9.

ISM Services Purchasing Managers’ Index | US (3 March)

The ISM Services PMI for the US unexpectedly rose to 55.2 in January 2023, up from a 2-1/2 year low of 49.2 in December. 

Analysts predict that the PMI will fall slightly in February 2023 at 54.6.

Make informed decisions with the most up-to-date and reliable financial data, exclusively provided by vtmarkets.com.