Approaching the close of trading this week, investors should prepare for the turbulence that awaits the opening of the New York session shortly.
Taking center stage is the publication of Canada's employment data report at 8.30pm local time.
If evaluated based on the forecast on the data component, the increase in employment for May is expected to be lower than the previous month which is 21,200 compared to 41,400.
Meanwhile, the unemployment rate is predicted to increase from 5.0% to 5.1%.
So, based on the forecast, the Canadian labor sector in May is more gloomy and this will influence the next monetary policy decision of the central bank of Canada.
Last Wednesday, the decision of the policy meeting by the Bank of Canada (BOC) surprised the market by raising interest rates by 25 basis points compared to expectations to keep them.
The move was seen following in the footsteps of the Reserve Bank of Australia (RBA) which earlier did the same surprise on Tuesday.
However, if the main economic data that is an indicator for the BOC after this is published with a gloomy reading, it is likely that the BOC will change its direction to be more passive again.
It is well known that if the policy tightening made by the central bank is too aggressive and continuous, it will have a negative impact on the economy of their country.
Thus, it is important for the central bank to assess the impact on the current economy on the monetary policy they implement.
Next, the market will prepare for the policy meeting of the European central bank (ECB), the Japanese central bank (BOC) and the main focus will be the FOMC meeting.
In addition, the important data that will be the focus of the market are such as UK and Australian employment data, CPI data, PPI and retail sales of the United States and a few more.
Surely this week's market turmoil will turn into a bigger wave next week. Investors need to get ready!
