Central banks preview: Fed, BoE, BoJ, RBA

[KoketsoIG]

FX traders brace for four central bank meetings. The Bank of Japan and the Reserve Bank of Australia on Tuesday, then on Wednesday it’s the turn of the US Federal Reserve and the Bank of England on Thursday.

Written by: Angeline Ong | Financial Analyst, Presenter and Content Editor, London

 

Publication date: Monday 18 March 2024 11:30

IG financial analyst @AngelineOng looks at what’s expected and why the BOJ decision is perhaps the most interesting monetary policy event this week.

(AI Video Summary)

Central Bank meetings

This week, there are four important central bank meetings happening that will have a big impact on Forex trading. On Tuesday, the Bank of Japan and the Reserve Bank of Australia (RBA) will have their meetings, followed by the Federal Reserve on Wednesday, and the Bank of England on Thursday. These meetings are very important because the decisions made by these central banks can affect the value of different currencies.

The Bank of Japan

Let's start with the Bank of Japan. They have recently increased wages, which is a good thing for the economy. However, there are concerns that this might lead to higher inflation, so the bank might need to make some changes to their monetary policy to control it. People are watching closely to see if they will raise interest rates from their current negative level.

The Reserve Bank of Australia

Next, we have the Reserve Bank of Australia. They are expected to keep their interest rates the same, but economists believe that they might make some cuts in the coming months. This is different from other central banks, so it's a bit surprising that the Australian dollar isn't getting stronger against the New Zealand dollar.

Moving on to the Federal Reserve, they will most likely keep interest rates steady for now. However, some recent economic data has been better than expected, which might make them reconsider. They will base their decisions on how the data looks in the coming months.

The Bank of England

Lastly, we have the Bank of England. They are not expected to make any changes right now, but there is speculation that they might cut interest rates later in the year. They are worried about wages increasing faster than prices, which could lead to inflation.

 

[Agarwal]

Central bank meetings this week will heavily influence Forex trading. Bank of Japan may adjust monetary policy due to concerns over inflation. Reserve Bank of Australia expected to maintain rates, but potential cuts loom. Federal Reserve likely to hold rates steady, monitoring economic data. Bank of England not anticipated to make immediate changes, but future rate cuts are speculated due to inflation concerns.

[KoketsoIG]

44 minutes ago, Agarwal said:

Central bank meetings this week will heavily influence Forex trading. Bank of Japan may adjust monetary policy due to concerns over inflation. Reserve Bank of Australia expected to maintain rates, but potential cuts loom. Federal Reserve likely to hold rates steady, monitoring economic data. Bank of England not anticipated to make immediate changes, but future rate cuts are speculated due to inflation concerns.

Hi @Agarwal,

Thank you for sharing.

Thanks,

KoketsoIG

[AhmedMarsh]

The Bank of Japan is attracting the most interest as there could be changes in monetary policy due to higher wages and concerns about inflation. The Reserve Bank of Australia is likely to leave rates unchanged, but there are expectations of future cuts. The Federal Reserve will likely keep rates on hold, but economic data could influence their decisions. The Bank of England is also not planning changes at the moment, but a rate cut is possible later in the year