Were policy makers going to stay the course?
That was the question on everyone's mind last week with a slew of central bank policy being announced. After they revealed their hand, relief came and the equity markets continued a general trend upwards. This week is about whether or not the macro data will show that the US has taken another step out of the recession; sustained recovery would likely improve risk sentiment. The three important economic indicators market will look to this week are the US ISM, the China PMI, and the US Nonfarm Payroll. Market expects an increase in both the ISM and the PMI to 46 and 53, respectively. The payroll numbers may disappoint. The market is predicting -350k. Traders anticipate the EURUSD to be range bound this week. In the Asia-Pac, data out this week will determine if the AUD's strength can be supported by retail and trade data. Rumors that China has acquired a massive amount of base metals and may be near the end of their purchasing doesn't bode well for the AUD.
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