The big central bank meeting of the week is the European Central Bank on Sept 5 (EDT).
Investors are looking for any change of policy maker thinking after a string of better than expected data rather than a change in policy on the day. The bank currently expects low inflation for an extended time. They may more clearly define “extended” if nothing else. The euro is likely to remain weak given expectations for Fed tapering and the dollar. The September Fed meeting is not so far away.
The Bank of Japan meets on Sept 4, (late EDT) New York local time, and is expected to leave
policy unchanged. Governor Haruhiko Kuroda is expected to reiterate confidence in the economic recovery and the 2 percent inflation target. He has always expressed readiness to respond to problems with economic growth. Without a very unlikely bombshell, investors will stay focused on the words and policies of Prime Minister Shinzo Abe. Expect the yen to weaken in the long term.
The Bank of England meets Sept 5, (EDT), a little before the ECB. The BOE has been the most
interesting central bank of late. Governor Mark Carney is still new and finding his feet and his place among the pre-existing members of the Monetary Policy Committee. Look for any change to forward guidance though even that is unlikely. Sterling weakened at the end of August and that is the most likely prevailing trend given the upcoming focus on the FOMC September 17 and 18.
The Bank of Canada meets Sept 4. Risks to the loonie are for a more dovish statement.
After the Reserve Bank of Australia today Sept 3, left the cash rate unchanged at 2.5 percent, comes the Australian Federal election on Sept 7.