Market Kicks Off the Week with Optimism Amid Heavy Data Load

The financial markets are kicking off the week with a packed economic calendar and a cautious attempt at recovery. Monday already delivered key data from China, with industrial production coming in stronger than expected at 5.9% (vs. 5.3% forecasted), signaling resilience in the world’s second-largest economy. Still ahead, traders will closely watch retail sales data from the U.S., expected at 0.6%, which could set the tone for the American session.

This week is significant as it brings interest rate decisions from major central banks, including the Federal Reserve, Bank of England, Bank of Japan, and Swiss National Bank. Traders are bracing for volatility as policymakers provide updates on their monetary stances amid growing concerns over inflation and economic stability.

Last week saw sharp declines in major indices, particularly in the U.S., where the DJIA and NASDAQ recorded one of their worst performances in months. However, Monday begins with optimism—both American and European futures are flashing green, attempting to recover some of last week’s losses. Whether this marks the start of a genuine bullish reversal or simply a technical rebound remains to be seen, especially with major central bank meetings ahead.

On the forex market, the U.S. dollar is on the backfoot, facing a bearish correction after last week’s gains. The New Zealand dollar and Australian dollar are leading the gains, buoyed by improved risk sentiment and stronger-than-expected Chinese industrial data.

Other notable movers include the Swiss franc and British pound, both showing strength in the early hours of the European session. The yen remains relatively stable, awaiting the Bank of Japan’s interest rate decision later this week, which could bring significant volatility to the USD/JPY pair.

Oil remains in a fragile state, struggling after a period of sustained weakness. However, Monday brings a slight upswing, which could be the beginning of a bullish correction—though it is too early to confirm a trend reversal. Traders will keep a close watch on any supply-related headlines or geopolitical developments that could shift sentiment.

Meanwhile, gold and silver are pulling back after last week’s impressive rally. Gold surged to fresh highs, driven by strong safe-haven demand, but today’s minor decline appears to be nothing more than a healthy profit-taking correction. The long-term trend for precious metals remains bullish, especially as inflation concerns and geopolitical uncertainties persist.

The main focus this week will be on the upcoming central bank decisions, with traders awaiting guidance on future rate moves. Markets will also pay attention to any trade war developments, particularly regarding tariffs imposed by the U.S. and retaliatory measures from China and Europe.

Monday may start on a calm note, but the rest of the week promises heightened volatility, with key inflation data, GDP releases, and interest rate decisions poised to drive the next major moves across asset classes.

Source: https://www.axiory.com/analytics/market-news/market-kicks-off-the-week-with-optimism-amid-heavy