FUNDAMENTAL REVIEW FOR THE WEEK (9 - 13 September 2024)

The current week promises to be relatively quiet in terms of the number and significance of upcoming economic events. Important auctions on US government bonds will take place from Tuesday to Wednesday. However, Fed officials are entering a "mute" period before the meeting on September 18, so traders do not have to worry about new statements and verbal interventions.

The main US economic reports are the consumer price index (CPI) and producer price index (PPI), based on which banks will be able to predict PCE inflation for August with the highest accuracy. These data will help to clarify the percentage probabilities for the rate cut expectations at the upcoming FOMC meeting, but the most key factor will be the retail sales report on September 17.

If consumer spending declines and inflation continues to fall, the Fed may cut the rate by 0.50%. It is also worth keeping an eye on the weekly unemployment data, although their reliability has long been in question, given the large number of revisions and "backdating" clarifications.

The ECB meeting on Thursday, September 12, does not promise any surprises, as the markets have already priced in the expected rate cut. The question is the timing of the next cut - if the ECB hints at the possibility of a cut in October, this will temporarily put pressure on the euro. If Lagarde says that October is unlikely, the euro may strengthen.

The UK will also not be left out and will present a number of important reports on Tuesday and Wednesday, which will affect the Bank of England's decision on the rate at the meeting on September 19.

As for the Asian region, we recommend waiting for the release of data on the Chinese trade balance on Tuesday, especially the import data, and Saturday's reports on industrial production and the labor market in China. They can directly affect the appetite for risk next week.

The Trump-Harris debate on September 10, while not going to directly impact markets, will be instructive for understanding the political outlook. Only the serious unrest that could potentially be caused by Donald Trump's side if he loses could trigger a flight "Big Money" to safe dollar.