Hi Folks.
Welcome to the first Econ Forecast for 2025. You'll notice a few changes in the Forecast, primarily the addition of an occasional comment on some Asian or London session reports, for those of you who trade those sessions. This required a small change in the physical format of the report, but nothing too drastic. You still get my unhinged rantings in all their glory.
So let's get on to the glory.
SUNDAY: Nothing (and for those of you who are curious, occasionally there is a report released on what is my Sunday evening that is worth watching for you Asian and London traders, so when that happens, you'll see it mentioned here).
MONDAY: Asian/London: Last week we had a ton of PMI numbers, and I mentioned that individually I didn't expect them to do much, but the way they are staggered through the calendar, if they all either end up better than expected (or worse) you could see a trend begin to develop so watch the charts and see if price appears to be reacting to the steady stream of good (or bad) news. As it was, the numbers last week pretty much landed on target so there wasn't much of a reaction one way or the other. But the same analysis applies here: even though the preliminary numbers were on target, if the final numbers stray away from expectations, keep an eye on the trend and see if you can jump in and grab a few before it flattens out. And if you trade the DAX, German CPI comes out at some point, but we don't have a fixed release time so all this one can do is surprise you. But be aware it's out there if you have any open positions
USA: Just garbage for the day here. Fed Speak at 9:30 a.m. Cook is delivering opening remarks at some Michigan Law School thing so once again, we can't trade it but it's out there possibly waiting to do some damage in some form or fashion, so be aware. 9:45 is Final Services PMI (no one cares) and at 10:00 a.m., Factory Orders m/m, one of the reports that never moves the needle even a little bit, so another one you can safely ignore.
TUESDAY: Asian/London: A Swiss CPI m/m number drops at 2:30 a.m. my time, and I am only mentioning it because FF has it listed as a Red Folder report. Last month it was projected to come in at -.1% which is exactly what happened. In the 30 minutes after the report dropped price on the USD/CHF went up 7 pips from the open of the 30M candle, then down 7 pips from the same open, and ended up closing 9/10ths of a pip lower than it opened. In other words, a great big nothingburger. I'd expect the same here. And to point out the nonsensical rating system used by FF, at 5:00 a.m. my time the EU drops their own CPI numbers, along with the Unemployment Rate, and those are just Beige folders (meaning not as important as Red folder news). Yet both are CPI numbers. Go figure. But at least the EU CPI generates some activity (about a 30 pip round trip on the E/J 30 minute chart when the numbers came out last November. So this one is probably worth watching, especially if the number ends up as a miss. At 7:30 p.m. my time the Aussies have their CPI y/y number, and that one was worth anywhere from 30-50 pips last month for anyone trading the AUD/USD. So this one looks promising for the Asian traders.
USA: Once again we start with Fed Speak at 8:00 a.m. (Barkin is speaking at the Raleigh NC Chamber of Commerce). Can't trade it but it can still do damage, so be aware. At 8:30 is Trade ImBalance, which is ignored by most, and at 10:00 we have the JOLTS Job Openings and ISM Services PMI numbers dropping at the same time. Alone both of these have a history of creating some price action, so together we should see some kind of activity, even if it only lasts 5-10 minutes.
WEDNESDAY: Asian/London: Tons of numbers and none of them worth worrying about.
USA: A little early start with the ADP Non-Farm Employment number at 8:15 a.m. This one doesn't move prices around so much but gives traders an idea of what Friday's NFP might look like. I don't think I've paid attention to this one in ages. At 8:30 a.m. we have Unemployment Claims w/w and Waller from the Fed speaking at the same time. Unless the Unemployment number really misses, I doubt we'll see much from this one. Maybe in a week or two when the annual post-Christmas firing of the seasonal employees starts showing up at the Unemployment office, then we'll see some bumps in the numbers. 10:30 a.m. is Crude Oil, the 10 Year Bond Auction starts at 1:01 p.m., but the 2:00 p.m. Fed Meeting Minutes may be where some real activity begins. It's not a number, just a summary of the Fed's last meeting, but if anything shows up in the minutes that makes The Street think rates are done going down for a while (which Powell alluded to multiple times since that last meeting) we could see the Indices charts head lower, at least for the day.
THURSDAY: Asian/London: Another collection of junk data not likely to help traders find any decent moving trades.
USA: 8 entries on the calendar, 4 of which are Fed Speak (at 9:00 a.m., 12:40 p.m., 1:30 p.m., and 1:35 p.m.) Of the actual numbers, we get Challenger Job Cuts at 7:30 a.m. (and my rule that numbers released outside of the normal market hours for the country involved can be safely ignored apply here), Final Wholesale Inventories at 10:00 a.m. (no one cares); Nat Gas at 10:30 a.m. (only important to Gas Traders) and the 30 year Bond Auction at 1:01 p.m. (just as untradeable as the 10 Year Bond Auction).
FRIDAY: Asian/London: Yet another day with a few numbers of little importance, except the Canadians release their Employment Change and Unemployment Rate at 8:30 a.m., the same time as the US NFP numbers drop. The one thing about Canadian numbers is that they really tend to make Canadian charts move around when they drop. So if you are a USD/CAD or a GBP/CAD or EUR/CAD trader, these are the numbers for you.
USD: As mentioned above, at 8:30 a.m. we have the Non-Farm Payroll, along with Average Hourly Earnings and our Unemployment Rate as well. NFP used to be the King of the Economic Numbers but traders have soured on the number some over the last few years. But it can still push prices around, especially if there is a miss. So be ready at 8:30 because this could be the best trading of an otherwise mediocre week. Then at 10:00 a.m. we close out the week with the Preliminary UofM Consumer Sentiment and Inflation Expectations numbers, neither of which anyone trades seriously. But if you need that last dopamine fix before the weekend gets here, this is your chance.
See you back next week with the next Forecast.
Jeff
