FX week ahead

The calendar is light on big events this week, with the Jackson Hole Symposium-starting Thurs and running in the weekend-the only clear highlight.

At the start of the week then, the focus is likely to remain on the general sentiment for risk assets, and whether that begins to be felt in all asset classes. So far equities and bonds (to a lesser extent) have been the main targets, while the impact on FX and commodities remains mixed. 

On Friday, the S&P500 closed down >3%, at the lowest level of the year, and VIX was up over 40%. FX vol, however, was up only slightly from the lows of the year. At Jackson Hole, Yellen will not be in attendance, but there will still be several key appearances (including Carney-see GBP). 

From the Fed, Fischer could attract the most attention, particularly any comments on global risk at the moment. A calm tone could see Fed hikes brought forward again, in a USD positive way.
Other than the Jackson Hole Symposium that begins on Thursday, this week's US highlights are the durable goods report on Wednesday and the second print of Q2 GDP on Thursday.

On Tuesday and Wednesday, RBA Governor Stevens will be attending the National Reform Summit and is expected to make public comments, but perhaps more importantly, Thursday we get the Q2 capex report. On the whole, the report should be a reminder of what softer demand from China means-downward revisions to mining capex plans as commodity prices weaken.

The main upcoming UK event may come at the very end of the week-just after the market closes-when Governor Carney speaks at the Jackson Hole Symposium. Ahead of that, there is very little of note, with the Q2 GDP detailed report on Friday the only event worth paying attention too.

There are three data releases worth watching this week in Europe: the August German IFO business survey on Tuesday, money & credit data on Thursday, and August German CPI on Friday. In the IFO, the market is looking for another all-around solid reading.