· BoJ, RBA and BoE are all set to announce their latest rate decision this week, while the FOMC will release the minutes from their September meeting
· Alcoa unofficially kick off earning season on Wall St., with analysts forecasting the first Y/Y EPS decline since 2009
This week may see macro news focus on central banks with a number of decisions expected from around the globe . Arguably the most notable central bank meeting will come from the BoJ, with analysts suggesting there is a chance that Kuroda and his committee could increase QQE . Although the consensus is for the BoJ to hold off on any amendments this week and at least wait for the October 30th meeting, where fresh forecasts will be supplied, analysts at Barclays note they see risks of possible action on October 7th. This week also sees rate decisions from both the RBA and the BoE, however the consensus is for both central banks to keep rates on hold, with recent BoE comments from the likes of Broadbent striking a more dovish tone than over the past few months. Also of note for AUD, Wednesday sees a number of large option expiries in AUD/USD including at 0.6900 (5.8bln) and at 0.7200 (6bln). Finally in terms of central banks, the Fed are set to release the minutes from their latest meeting, which was interpreted as dovish by the market. However the fact that Fed’s Yellen held a press conference immediately after the decision limits the amount of new information that the minutes may provide.
In terms of equity news, Asian indices may see a subdued start to the week given that Golden Week continues until October 7th on mainland China, while over in the US Alcoa are set to report, unofficially kicking off earning season , with the likes of PepsiCo, Yum Brands and Monsanto also reporting this week. Sentiment heading into this earning season has been mixed, with many analysts expecting this quarter to show the first Y/Y decline since Q3 2009, weighed on particularly by commodity related companies as energy prices remain under pressure. However, on the other hand this quarter has seen just 76 companies in the S&P 500 issuing profit warnings, the fewest number of companies Q2 2012, suggesting that earnings this quarter may not be as downbeat as some forecast.