September FOMC Meeting Minutes Draw Attention, U.S. Inflation and Retail Sales Data in Focus
U.S. shares were mixed at the close on Friday with the S&P 500 ending a six-day run of record highs. At the close in NYSE, the S&P 500 index fell 0.11%, paring its weekly gain to 1.2 percent. The Dow Jones Industrial Average also retreated, losing 0.01 percent to close at a weekly increase of 1.6 percent. By contrast, the NASDAQ Composite index gained 0.07%, contributing to a weekly gain of 1.5 percent and extending its rally to a ninth straight day.
Meanwhile, the U.S. dollar reversed lower from a more than two-month high recorded earlier in the session and lost ground versus its peers amidst fresh worries over tensions with North Korea. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, slipped by 0.16% at 93.62 late Friday from a high of 94.10 earlier in the session.
The greenback had been supported by U.S. jobs report for September showed higher than expected wage growth although U.S. nonfarm jobs declined for the first time in seven years due to the effects of Hurricanes Irma and Harvey.
The Labor Department on Friday reported that the U.S. economy lost 33,000 jobs in September. However, the jobless rate fell from 4.4 percent to 4.2 percent last month – the lowest since 2001 while average hourly earnings rose 2.9% from a year earlier.
On Wednesday, the Federal Reserve is scheduled to release minutes of its most recent policy meeting where it left interest rates unchanged and signaled one more rate in the upcoming December meeting. Following its meeting on September 20, the bank also announced its plan to start rolling back its $4.5 trillion balance sheet in October.
Besides the minutes, there are a handful of Fed speakers including Governor Jerome Powell, Governor Lael Brainard, Dallas Fed chief Robert Kaplan, Minneapolis Fed President Neel Kashkari as well as Chicago Fed President Charles Evans.
On Friday, the Commerce Department is due to publish September inflation figures amidst expectations calling for a rise of 0.6% in consumer prices and an increase of 0.2% in the core inflation. Besides data on CPI, the Commerce Department at the same time will publish its figures on retail sales for September. Analysts forecast retail sales increased 1.6% and core sales added 0.3 percent last month.
Next week also witnesses the third-quarter earnings season in the U.S. kicked off with major banks such as JPMorgan Chase and Citigroup reporting on Thursday, followed by Bank of America and Wells Fargo on Friday.
Turning to the euro, the single currency touched a low of $1.1670 – the weakest level since August 17 before rising back to $1.1732 at the close on Friday. The European Central Bank President Mario Draghi is scheduled to take part in a panel discussion about monetary policy at the Peterson Institute for International Economics, in Washington DC on Thursday. ECB’s next meeting is scheduled for October 26.
Meanwhile, the British Pound recorded a decrease of 0.4% to 1.3065 late Friday, which contributed to a weekly decline of 2.47%, the largest weekly decline in more than a year. In the week ahead, the Office for National Statistics is to produce data on UK manufacturing production for August on Tuesday. Analysts expect manufacturing production to advance by 0.3 percent and industrial output to climb 0.2 percent.
On Friday, Chine is to release September trade figures with forecasts calling for the country’s trade surplus to narrow to $39.5 billion last month following a surplus of around $42.0 billion in August. The increase in imports which are expected to reach 13.5% is anticipated to offset a rise in exports which is forecast to jump only 8.8%.