Christmas break in markets will cause delayed reaction to macroeconomic data

Global financial markets are currently grappling with a temporary holiday break, meaning the reaction to the latest economic data is likely to be delayed until markets reopen next week.

Next week’s calendar is packed with major economic releases, including US housing data, PMIs from major economies and corporate earnings reports. These releases are expected to shed light on the economic outlook amid rising US-China trade tensions. In Japan, core inflation accelerated to 3,2% in March, driven by continued increases in food prices. Core CPI, in line with market forecasts, rose from 3% in February. This is the third straight year that inflation has exceeded the Bank of Japan's 2% target, complicating its upcoming monetary policy decision as the central bank balances rising price pressures with risks from U.S. tariffs.

Meanwhile, the New Zealand dollar weakened against the US dollar to $0,591 as higher-than-expected inflation data failed to change expectations for further rate cuts by the Reserve Bank of New Zealand (RBNZ). New Zealand's economy is in the early stages of recovery after years of recession, with price pressures in the country gradually easing.

As for today’s session, investors will be closely watching comments from Fed Banker Dally for any clues about the future direction of monetary policy from the US central bank. CFTC data on speculative positions could provide valuable information on how investors are positioning themselves ahead of next week’s trading, especially after recent market volatility.

Source: XTB Analysis Department