AUSTRALIAN DIARY: Everything you need to know about the week ahead for markets

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US stocks edged higher on Friday night after four straight losing sessions, shrugging off recent concerns about trade wars and upheaval in the White House.

But a general tone of caution remains prevalent, as evidenced by the S&P500’s 1.2% weekly decline and slightly increased demand for bonds.

Meanwhile, it was a rough end to the week for the Aussie dollar, as Thursday’s selloff extended into Friday night.

AUD/USD Daily Chart

The sharp retreat meant the AUD had its biggest two-day fall — in percentage terms — against the US dollar since Brexit.

Key data in Australia this week will be led by Thursday’s February employment report, while internationally all eyes will be on the US Federal Reserve’s interest rate announcement on Wednesday night.

Australia

Data from the ABS on Thursday (11:30am AEDT) is expected to show that Australia’s economy extended its record streak of jobs growth in February.

Analysts are forecasting another 20,000 jobs to be added with the unemployment rate to hold at around 5.5%.

There’s also the board minutes from the RBA’s March meeting on Tuesday afternoon, where the market will look for clarity on the central bank’s growth forecasts.

That follows a change in the wording of the bank’s statement accompanying this month’s interest rate announcement, which hinted at slightly lower growth expectations.

Also on Tuesday the ABS has quarterly house price data for Q4 2017, which rounds out the schedule of headline data and events in Australia this week.

International

Looking abroad, it’s a busy week ahead in the UK starting with February CPI figures on Tuesday.

CBA analysts expect annual inflation to rise by 2.9%, and stay at around 3% for the first half of the year.

The UK also has February retail sales data on Tuesday followed by unemployment figures and average weekly earnings for January on Wednesday.

Also on Wednesday night there’s the US Fed’s March interest rate announcement.

A 25 basis point rate hike is more or less a done deal — which will take the benchmark rate to a range between 1.5-1.75%.

So the focus will be on the FOMC’s accompanying statement to see if the Fed upwardly revises its 2018 rates outlook to four hikes instead of three.

The Reserve Bank of New Zealand will also make its interest rate announcement on Thursday morning in Asian trade, with rates likely to stay on hold at 1.75%.

And capping off a big week for the UK, the Bank of England will make its interest rate announcement on Thursday night.

Benchmark rates are forecast to stay on hold at 0.5%, with no changes to the BoE’s monthly asset purchase program of 435 billion pounds.

Rounding out the week of key data abroad, the Eurozone has preliminary March PMIs for manufacturing and services — which are expected to show Europe’s economy remains on a steady growth path.

Have a great week.

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