Fed and BoC Decisions Take Center Stage

The Week Ahead: Week of January 26, 2025 (GMT+3)

Weekly Market Preview
Markets enter the final full week of January with positioning increasingly sensitive to central bank guidance and short-term shifts in macro expectations. The Federal Reserve decision is the week’s core catalyst, with investors looking for any signal that policymakers are becoming more confident in disinflation progress or alternatively, remaining cautious due to sticky price pressures and resilient activity.

Canada’s rate decision adds another major policy event, likely driving volatility in CAD pairs as traders assess whether the BoC maintains a restrictive stance or prepares for eventual easing. Outside of central banks, U.S. data including durable goods orders, consumer confidence, jobless claims, and producer prices will help clarify whether demand is stabilizing or cooling as financial conditions remain tight.

In Europe, German GDP and CPI updates will provide early signals for Eurozone growth and inflation momentum, shaping expectations around the ECB’s 2026 policy path. China’s manufacturing PMI closes the week as a key global demand barometer, with implications for risk sentiment and commodity-linked assets. With month-end flows and central bank outcomes converging, data surprises may trigger sharp moves across FX, rates, and equities.

Key Events to Watch:

Monday, January 26 – 16:30

U.S. Durable Goods Orders (MoM) (Nov)

Previous: –2.2% | Forecast: N/A | Actual: N/A

Durable goods data offers insight into business investment demand and industrial momentum. A rebound would support confidence that activity remains resilient despite restrictive financial conditions. Continued weakness would reinforce the view that higher rates are increasingly weighing on capital spending and growth expectations.

Tuesday, January 27 – 18:00

U.S. CB Consumer Confidence (Jan)

Previous: 89.1 | Forecast: N/A | Actual: N/A

Consumer confidence provides a timely read on household sentiment and spending outlook. Rising confidence would support risk assets and reinforce demand resilience, while weakness could signal growing stress from inflation and borrowing costs, weighing on equities and the U.S. dollar.

Wednesday, January 28 – 16:30

U.S. President Trump Speaks

Previous: N/A | Forecast: N/A | Actual: N/A

Markets will watch closely for any comments tied to economic policy, trade direction, fiscal priorities, or currency themes. Political headlines can create sudden volatility across USD pairs, U.S. equities, and broader risk sentiment.

Wednesday, January 28 – 17:45

Canada BoC Interest Rate Decision

Previous: 2.25% | Forecast: N/A | Actual: N/A

The Bank of Canada’s decision will guide expectations for the timing and pace of potential easing in 2026. A cautious stance emphasizing inflation risks may support CAD, while more dovish guidance could pressure the currency and lift domestic rate-cut pricing.

Wednesday, January 28 – 22:00

U.S. Fed Interest Rate Decision

Previous: 3.75% | Forecast: 3.75% | Actual: N/A

The Fed decision is the week’s most influential catalyst for USD and global risk assets. Markets will focus on whether policymakers maintain a firm stance against inflation risks or show increased confidence that inflation is cooling sustainably. Any shift in tone could reprice yields sharply and drive broad FX direction.

Wednesday, January 28 – 22:00

FOMC Statement

Previous: N/A | Forecast: N/A | Actual: N/A

The statement will be analyzed for changes in language around inflation progress, economic activity, and policy risks. Even subtle adjustments may shape expectations on the pace of easing later in 2026.

Wednesday, January 28 – 22:30

FOMC Press Conference

Previous: N/A | Forecast: N/A | Actual: N/A

Powell’s guidance will likely define market direction into month-end. Dovish signals may weaken USD and support equities, while a hawkish tone emphasizing inflation vigilance could lift yields and pressure risk assets.

Thursday, January 29 – 16:30

U.S. Initial Jobless Claims

Previous: 200K | Forecast: N/A | Actual: N/A

Claims are closely watched for signs of labor market cooling. A steady increase would reinforce expectations of easing labor conditions, supporting dovish Fed repricing. Stable claims would signal resilience and support the soft-landing narrative.

Friday, January 30 – 12:00

German GDP (QoQ) (Q4) – Preliminary

Previous: 0.0% | Forecast: N/A | Actual: N/A

Germany’s growth print will be an important signal for broader Eurozone momentum. An upside surprise could support EUR and improve sentiment, while weakness would increase concerns about stagnation and reinforce dovish ECB expectations.

Friday, January 30 – 16:00

German CPI (MoM) (Jan) – Preliminary

Previous: 0.0% | Forecast: N/A | Actual: N/A

Germany’s CPI provides an early read on inflation trends ahead of full Eurozone releases. Softer inflation would strengthen expectations for ECB easing later in 2026 and weigh on EUR, while a firmer reading may offer temporary support.

Friday, January 30 – 16:30

U.S. PPI (MoM) (Dec)

Previous: 0.2% | Forecast: N/A | Actual: N/A

Producer prices provide insight into pipeline inflation pressures that can eventually feed into consumer prices. Another subdued reading would support the disinflation narrative, while a surprise rise could revive inflation concerns and lift yields.

Friday, January 30 – 17:45

U.S. Chicago PMI (Jan)

Previous: 43.5 | Forecast: N/A | Actual: N/A

Chicago PMI offers an early signal for broader manufacturing conditions. Continued weakness would highlight contraction risks, while improvement would suggest stabilization and support risk sentiment.

Saturday, January 31 – 04:30

China Manufacturing PMI (Jan)

Previous: 50.1 | Forecast: N/A | Actual: N/A

China’s PMI is a key global demand indicator with strong implications for commodities and risk sentiment. A print above 50 signals expansion and could support risk assets, while a drop below 50 may raise concerns over global growth momentum.