Week Ahead: RBA, FOMC Minutes and Non-Farm Payrolls


Volatility may pick up later in the week as the RBA makes its decision on interest rate and the US publishes FOMC Minutes, as well as NFP.

Central Bank chiefs were in the spotlight last week at the European Central Bank Forum. Fed Chairman Powell, ECB Chairman Lagarde and BOE Governor Bailey said the same message: We need to lower inflation at any cost, even if it causes a recession. Will the news and data appear this week continue to paint a picture of a world economy with high inflation and slower growth? The RBA is meeting on Tuesday and is expected to raise 50bps, although AUD / USD has fallen to its lowest level since June 2020. Will the decision help the sick currency pair? On Wednesday, the United States will release the June minutes of an FOMC meeting. What was the discussion about the decision to raise 75bps? Also, on Friday, the U.S. releases Non-Farm Payments. Will the job image continue to show a strong job market?


The RBA is meeting Tuesday this week for its July interest rate decision. Markets expect an increase of 50 bps, which would raise the key rate from 0.85% to 1.35%. At the last meeting on June 7thth, the board decided that due to inflationary pressures and a strong labor market, there will be further tension. However, for those who may expect a 75bps increase at this week’s meeting (as well as the FOMC), RBA Governor Lowe has already closed that, saying in late June that the decision at the next meeting will be between 25bps and 50bps. Since the June meeting, the Employment data, PMI data, Retail Sales and Inflation Expectations have all come out stronger than expected. However, global fears of a recession have also crept into the market, causing commodity currencies to move lower. AUD / USD made a low print of 0.6764, its lowest level in 2 years and holding the 50% rebound level from the pandemic lows in March 2020 to the February 2021 highs at 0.6757. Will the RBA be sharp enough to give a rebound to the Aussie?

FOMC Protocol

At the June FOMC meeting, the Committee grew by 75bps. Markets jumped 50bps until just a few days before the meeting, when the Fed leaked the news to the Wall Street Journal that it would raise 75bps due to the higher-than-expected CPI and Michigan Inflation Expectation Index. Markets will be looking to see how much discussion has taken place to raise the 75bps versus 50bps. In addition, the Committee raised its tax forecast to 3.4% by the end of the year. The current index sits at 1.75%. Inflation forecasts were also increased. Powell noted in this press conference that the Fed is “very alert” to inflation risks and that the Committee continues to see risks for inflation to the top. Was the whole discussion about lowering inflation? How much of the discussion has revolved around the possibility that the Fed could raise rates “too high” and push the economy into recession? The Protocol released on Wednesday will give us a better view of the FOMC’s thinking at the June meeting.

Non-farm Wages

At the June FOMC meeting, Powell indicated that “our goal is to lower inflation to 2%, while the labor market remains strong.” On Friday, the U.S. will have a better sense of whether job numbers are still strong. The expectation for the title print is +265,000 versus the May reading of +390,000. Last month’s print was higher than expected, but the lowest reading since May 2020 after the pandemic hit. In addition, the Unemployment Rate is expected to remain at 3.6% while Average Hourly income is also expected to remain unchanged at 0.3% MoM. However, there is a risk that the headline NFP print will come in weaker than expected as the four-week moving average for initial claims rose to 231,750, the highest since mid-December 2021. If employment growth begins to slow, or even worse , turn negative, how much will the Fed hold when it comes to raising rates? This will be an important economic data point for the Fed to watch this week!


The beginning of the 3rd a quarter brings a new round of winning editions for Q2. However, earnings season doesn’t start seriously until next week. There are a number of names released this week, including Sainsbury’s and Currys.

Economic Data

U.S. non-farm payrolls will be the main attraction according to economic data this week. However, there are some other data points that can cause volatility. On Tuesday, China will release its Caixin Services PMI and the US will release Factory Orders. The EU will release Retail Sales on Wednesday and on Thursday the US will release the ADP Employment Change. In addition to the U.S. NFP on Friday, Canada will also release its Employment Change. Other important economic data released this week are:


  • Australia: Building Permits (MAY)
  • Australia: Home Loans (MAY)
  • Germany: Trade Balance (MAY)
  • EU: PPI (MAY)
  • Canada: Production PMI Final (JUN)


  • Global: Services PMI Final
  • New Zealand: NZIER Business Confidence (Q2)
  • Australia: Retail Final (MAY)
  • China: Caixin Services PMI (JUN)
  • Australia: RBA Interest Rate Decision
  • United States: Factory Orders (MAY)


  • Australia: RBA Chart Pack
  • Germany: Factory Orders (MAY)
  • EU: S&P Global Construction PMI (JUN)
  • EU: Retail Sale (MAY)
  • United States: Global Services PMI Final (JUN)
  • United States: ISM Non-Manufacturing PMI (JUN)
  • United States: FOMC Protocol
  • Raw Stocks


  • Australia: Trade Balance (MAY)
  • Germany: Industrial Production (MAY)
  • UK: Halifax House Price Index (JUN)
  • Mexico: CPI (JUN)
  • United States: ADP Employment Change (JUN)
  • Canada: Trade Balance (MAY)
  • United States: Trade Balance (MAY)
  • Canada: Ivey PMI (JUN)


  • Canada: Employment Change (JUN)
  • United States: Non-Farm Wages (JUN)

Graph of the Week: Weekly U.S. 10-year yields

forexcom 2022070211

Source: Tradingview, Stone X

U.S. 10-Year yields moved back below 3% this week and fell to a low of 2.791%, closing the week down above 7%. Yields have moved lower since early November 2018 when they were close to 3.232%. At the start of the pandemic, 10-year yields fell by 0.333% in March 2020, then slowly began to move higher in a symmetrical triangle. Yields finally broke above the top of the top of the triangle as they approached the apex during the 1st week of January 2022. The target for the rupture of a symmetrical triangle is the height of the triangle, added to the breaking point., which is about 3.30%. Bonds moved lower and yields continued to move higher during the first half of 2022, reaching the target within 6 months! During the week of June 13thth, yields pulled out of the November 2018 highs and formed a firing candlestick formation with the RSI in overbought territory, a signal that yields may retreat. The maximum for the move was 3,497%. Since then, yields have regressed aggressively and are trading near 2.9%. First support is at the low of the week of May 30thth at 2,643. Down there, price may fall to the 38.2% Fibonacci retracement from the lows of March 2020 to the recent highs of June 13th.th near 2.288%, then horizontal support at 2.063%. First resistance is at last weeks high of 3.258%, then the highs of the week of June 13th.th at 3.497%. Up there, yields may move up to 2011 highs at 3.737%.

It is the beginning of a new month and a new quarter, and also the beginning of the second half of the year. With an American holiday on Monday, the week can start slowly. However, volatility may pick up later in the week as the RBA makes its decision on interest rate and the US publishes the FOMC Protocol, as well as NFP. Also be aware that new cash flows will come into the market earlier in the week.

If you’re celebrating the U.S. holiday on Monday, enjoy.

Have a great weekend!



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