The fate of the dollar and Japanese yen is in the balance

The coming week promises to be extremely interesting for observers of global financial markets. The key event will be the meeting Federal Open Market Committee (FOMC) Federal Reserve, which will provide economic forecasts and the so-called "dot plot", i.e. projection of interest rates. Other events and data are also noteworthy, both in the United States and around the world.

Fed: when will the first rate cuts and what's next with QT?

In the United States, all eyes will be on the Federal Reserve meeting scheduled for Wednesday. Interest rates are expected to be maintained at current levels for the fifth consecutive year, as the labor market continues to be strong and inflationary pressures are gradually slowing. Investors will be closely monitoring the FOMC's economic forecasts and interest rate projections, especially after the recent data CPI and PPI exceeded expectations, prompting investors to moderate their expectations of future rate cuts.

Other key indicators to watch are the Manufacturing and Services PMI, building permits, housing starts and existing home sales. Additionally, attention will be directed to other important data such as the current account balance for the fourth quarter, sentiment among home builders and the Industrial Index Fed from Philadelphia.

Europe and the UK in focus - it's time for the BoE

In the UK, the Bank of England is likely to keep interest rates unchanged at 5,25% on Thursday, with a rate cut expected in August. Core inflation is expected to have increased by 0,7% month-on-month, resulting in an annual slowdown to 3,6% - the lowest level since September 2021. Investors will also expect PMI data from S&P Global, GfK consumer confidence, producer prices, retail trade, net public borrowing and CBI factory orders.

Asia in the spotlight. Will the Bank of Japan change its monetary policy?

In Japan it is expected Bank of Japan will end its negative interest rate policy after a year of wage negotiations led to strong wage increases. Investors will also be closely watching inflation data, flash PMI, exports and imports, the Reuters Tankan Index and final industrial production numbers.

In China, the People's Bank of China is likely to keep interest rates on concessional loans unchanged. Updates on industrial production, retail sales and fixed asset investment will be crucial to understanding the country's economic performance in the first two months of the year.

The international scene and subsequent decisions on interest rates

In addition to the regions mentioned above, interest rate decisions will also be made in Brazil, Canada, Turkey, Switzerland and Norway. Inflation data will be monitored in Canada, the UK, South Africa and Japan. Globally, investors will also be examining flash PMIs for the manufacturing and services sectors from Australia, Japan, India, the euro zone, France, Germany and the United Kingdom.

The coming week will certainly provide a lot of important information that may affect global financial markets. Both individual and institutional investors will be closely monitoring the above developments.