Trading Week Ahead: Markets Brace for Fed Signals and NFP Amid Shutdown

Markets face a data storm this week as FOMC Minutes, Nonfarm Payrolls and the Unemployment Rate take the spotlight. With the US government already in shutdown mode, key data releases may be delayed or limited. In this fog of uncertainty, traders should prepare for sharp moves across FX, bonds and equities as markets react to every available signal.

• FOMC Minutes
This week’s release of the Fed’s latest meeting minutes gains added importance as markets seek clarity amid a potential data blackout. With fewer macro prints available due to the shutdown threat, any dovish tilt in the Fed’s tone could weigh on the dollar and Treasury yields while lifting risk assets. Conversely, a reaffirmed hawkish stance may reinforce bets on prolonged higher rates, boosting the greenback and pressuring equities.

• Nonfarm Payrolls
Friday’s NFP report (previous: 22K, forecast: 51K) arrives at a time of elevated political tension. A potential U.S. government shutdown could amplify market sensitivity to economic data. A solid increase in employment would likely strengthen the dollar and push rate-cut expectations further out, while a disappointing result could revive risk appetite and put pressure on the greenback.

• Unemployment Rate
While often overlooked compared to payroll data, the unemployment rate could still move markets, especially if other economic reports face shutdown-related delays. Analysts expect the rate to hold steady at 4.3%, matching the previous figure. A higher reading would point to softening labour market conditions and could push the Fed closer to rate cuts. A lower print would likely support the view that rates need to stay elevated for longer.

*All times in the table are in GMT+2