In the European session, no economic events are scheduled, leading to potential stable market conditions ahead of next week’s labour market data. Traders are monitoring how markets react to recent developments from the Jackson Hole symposium.

In the American session, the US Durable Goods Orders and the Consumer Confidence report are anticipated. The durable goods data is typically not market-moving due to its volatility, with emphasis placed on consumer confidence figures. Consumer confidence is expected to show a slight dip to 96.2, down from 97.2 previously.

Consumer Confidence Report

The prior report noted improved consumer confidence, particularly in the expectations index. Data trends indicate overall improvements in the economy, as demonstrated in recent US PMI releases. Although consumer confidence has the potential to impact markets, substantial deviations in data are necessary for prolonged effects.

This week’s primary focus shifts towards the US Jobless Claims on Thursday, with the ensuing labour market data, including the NFP report, taking precedence next week. Central bank speakers scheduled include Fed’s Barkin at 12:30 GMT, BoE’s Mann at 16:00 GMT, and BoC’s Macklem at 18:45 GMT. All speakers hold neutral stances, with one an active voter.

Today’s focus is on the US Consumer Confidence report, which could challenge the market’s recent direction. After what seemed to be a hawkish message from the Federal Reserve at Jackson Hole last week, we’ve seen Treasury yields and the dollar pull back slightly. A significant surprise in the confidence number could either reignite that move or solidify the market’s current wait-and-see attitude.

We are looking for a consumer confidence reading near the expected 96.2, which would continue a gradual cooling from the 102.0 peak we saw back in May 2025. Given this context, only a number below 93 or above 99 would likely trigger a sustained market reaction. Otherwise, attention will immediately shift to more impactful data releases scheduled for later.

Labor Market Data

For derivatives traders, this period of anticipation ahead of next week’s crucial labor data is defined by volatility expectations. The VIX index is currently trading near a low of 14, suggesting that options markets are not pricing in a major surprise from today’s report. This environment may favor strategies that profit from a range-bound market, but carries the risk of being caught on the wrong side of a sharp move if confidence data deviates widely.

The most important event remains the labor market data, beginning with Thursday’s Jobless Claims and leading to next week’s NFP report. After July’s non-farm payrolls came in at a solid 195,000, another strong report for August would put pressure on the Fed to maintain its restrictive stance. This jobs data will be the main driver influencing expectations for the Fed’s policy decision in November.

We will also listen to comments from Fed speaker Barkin, though as a non-voter his words are unlikely to have a major impact unless he signals a significant shift in thinking. More pertinent for currency specialists could be the speech from Bank of Canada Governor Macklem, which has the potential to move CAD-related pairs. These appearances will be closely watched for any new clues regarding the future path of interest rates.

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