Markets weekly outlook - FOMC, BoJ and BoE Rate Decision, risk-off flows?

[Redator]

Week in review: Sentiment jumps around between positive CPI & PPI reports and major geopolitical turmoil

The week began quietly across most asset classes, except for cryptocurrencies—Bitcoin surged to the $110,000 level before pulling back. Forex markets remained subdued as participants awaited key US inflation data, with the Consumer Price Index (CPI) and Producer Price Index (PPI) released on Wednesday and Thursday, respectively.

One recurring theme was the underwhelming progress in US-China talks, which yielded few concrete outcomes beyond commitments to continue discussions.

We got two consecutive Inflation reports that were welcomed news for markets with the Core PPI coming in at 3.0% vs 3.1% exp. and Core CPI coming in at 0.1% m/m vs 0.3% expected. [Linked: Full data breakdowns]

Turning to less-publicized data, the third consecutive Weekly Jobless Claims report came in above expectations, a developing trend that warrants further attention. This softer labor data contributed to some safe-haven demand, evidenced by a strong 30-year US Bond auction—a rare sight throughout the past year.

However, the week's most significant risk-off event unfolded yesterday evening with reports of Israel's strikes on Iran's nuclear infrastructure. Initial reports indicate targets included key figures involved in the Iranian nuclear program and significant damage to defense capabilities.

As this article is being written, headlines continue to emerge, suggesting this could evolve into a major story for the weeks to come. While a similar incident in August 2024 ultimately failed to result in significant further escalation, the current situation commands close attention.

Nonetheless, crude oil prices surged from $64 to overnight highs of $76, and are currently trading above the $73 mark.

A more detailed analysis on this will be provided in the "Chart of the Week" section further in the Weekly Outlook.

The Week ahead: Central banks rate decisions for the US, Japan and the UK & Retail Sales Data reports

The upcoming week is promised to be interesting for markets all around the globe, from planned events to potential headlines.

Asia Pacific Markets - Japanese CPI and BoJ Rate Decision

This week will start with China Retail Sales, with many eyes still looking at the current state of activity for the World's biggest exporter.
The data releases on Sunday at 10:00 P.M. E.T. and expected at 5% Y/Y.

Even more market moving, we will see the release of the Bank of Japan central bank decision on Monday evening.

The BoJ is a tough central bank to predict, with the main interest rate currently at 0.50%, it is still generally expected that they won't hike rates on this meeting, but it's still worth observing that the yields on the Japanese 2 Year Bond is trading at 0.733%, there is at least one hike priced in the 2 year forward market-determined rates.

Bank of Japan meetings tend to be even more surprising with the date of the decision constantly changing. The outcome is typically released between 7:00 P.M. to 8:00 P.M.

We will also get the PBoC rate decision on Thursday at 21:15, though it doesn't tend to move markets too much.

APAC markets won't see the release of many other high-tier economic data releases except for the Australian Employment data release (Wednesday 21:30) and the Japanese CPI data with the Core expected at 3.6% Y/Y.

Economic Data from Europe, UK and the US – FOMC and BoE Rate Decision

The most significant economic events in Western markets this week will be central bank monetary policy decisions.

The Federal Open Market Committee (FOMC) is scheduled to conclude its meeting on Wednesday, June 18th, with the decision at 2:00 and press conference at 2:30 PM E.T.

Interest rates are broadly anticipated to remain unchanged, but markets will be attentive to the speech from Jerome Powell particularly as it comes to communication about future meetings, with the consecutive misses in inflation data.

Wednesday will also see the release of the UK CPI with a consensus at 3.4% Y/Y.

Following this, the Bank of England (BoE) will announce its decision on Thursday, June 19th, at 7:00 AM E.T. Expectations for the BoE are mixed, with some anticipating a 25-basis point rate cut.

There's also the release of both the US and UK retail sales, with the year-over-year data and the Eurozone harmonized CPI data.

For all market-moving economic releases and events, see the MarketPulse Economic Calendar.

Chart of the week: US Oil

US Oil WTI Daily Chart, June 13, 2025 – Source: TradingView

All types of levels had to be review for US Oil prices as a significant breakout occured after a month-long consolidation $12 lower.

Oil is up around 14% on the week.

Since the middle of May, prices had been trading between 60.5 and $64 – Prices broke out of that range last Friday as discussions with Iran already started to stall and this theme kept on going throughout the week.

It was a double breakout as prices were also being held by the Daily descending channel, and we are now trading far from it.

The biggest push though was yesterday evening with a 10.80% move up after the turmoil in the Middle-East.

Prices had since retraced at the current pivot (between $72 to $73) and are currently going back up from that point.

Keep an eye on that pivot zone as a move below would be pointing at a retracement, and staying above would look at testing the highs, which may happen particularly if tensions persist.

• Current Main Support: $70 zone
• Daily MA 200 $69 acting as support
• Further support at $68

• Main Resistance 1: $75 to 76
• Main Resistance 2: $80 to $80.75 (2025 highs)

Have a good weekend, and Safe Trades for the week ahead!

Opinions are the authors'; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. The provided publication is for informational and educational purposes only.
If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please refer to the MarketPulse Terms of Use.
Visit https://www.marketpulse.com/ to find out more about the beat of the global markets.
© {CURRENT_YEAR} OANDA Business Information & Services Inc.