Synopsis:

ANZ anticipates significant economic data releases and FOMC developments this week, which may have implications for the USD's performance.

Highlights:

1. Upcoming Data Releases:

   • The week is crucial for economic insights with releases including the ISM Manufacturing and JOLTS (Job Openings and Labor Turnover Survey).
   • ISM surveys have historically outperformed corresponding PMI (Purchasing Managers' Index) readings, suggesting a robust U.S. economic landscape.
   • The NFIB (National Federation of Independent Business) shows a slight improvement in hiring plans, and the upticks in Fed regional activity indices suggest that job openings for September were above the trend. This could indicate that the USD remains strong against the G10 currencies.

2. FOMC November Meeting:

   • ANZ predicts another pause in policy changes during the FOMC meeting.
   • Chairman Powell is not expected to alter his stance on potential rate hikes. He might emphasize that there's still room for one more hike as reflected in the dot plot and that it will be implemented if necessary.
   • This suggests that the pattern observed in September and July – a mild weakening of the USD followed by a recovery – is likely to recur after this meeting.

3. Outlook for the USD:

   • ANZ believes that, leading up to the US payrolls release on Friday, there is minimal chance for significant fluctuations in the USD when compared to its current performance against G10 currencies.

Conclusion:

ANZ projects a consequential week for the U.S. economy with pivotal data releases and FOMC outcomes on the horizon. The bank believes the USD will sustain its strength against G10 currencies, especially given the positive signals from the forthcoming data. However, in the wake of the FOMC meeting, the USD might exhibit a familiar pattern of mild weakness followed by a resurgence. The bank anticipates limited significant deviations for the USD against G10 crosses before the release of the US payrolls.