Weekly Market Outlook: October Begins With Volatility Ahead

As we close out September and step into October, markets are preparing for another month filled with volatility. Interest rate cuts remain firmly on the agenda, economic data is stacked throughout the calendar, and the possibility of a U.S. government shutdown could set the tone for the weeks ahead.

U.S. Government Shutdown Looms

The big focus early this week is in Washington. If Congress fails to reach a deal before Wednesday, the U.S. government could shut down. President Trump is meeting with congressional leaders in a last-ditch effort to avoid this scenario. A shutdown would not only create uncertainty but could also postpone key economic data releases until funding is restored.

Tuesday: Central Banks and Early Data

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  RBA Rate Decision: Markets expect the Reserve Bank of Australia to keep rates unchanged at 3.6%.

  
  


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  UK GDP: Forecast remains at 0.3%. Any revision here could spark volatility in Sterling exchange rates.

  
  


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  Germany Flash CPI: Expected at 2.3%. As a preliminary figure, this release may have limited market impact.

  
  

Wednesday: PMI and Jobs Data

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  Manufacturing PMI from the Eurozone, UK, and U.S. will remain under the 50 mark, highlighting contraction. The U.S. figure is forecast at 40 — an improvement but still weak.

  
  


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  U.S. ADP Employment is expected to show fewer jobs added than last month, a negative signal for the Dollar.

  
  

Thursday: Labour Market Updates

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  Eurozone Unemployment is expected to hold steady at 6.2%.

  
  


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  U.S. Weekly Jobless Claims are forecast at 225k — a higher number that could provide short-term support for the Dollar.

  
  

Friday: Services PMI and Non-Farm Payrolls

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  Services PMI for the U.S. is expected lower at 51.7, adding pressure on the Dollar.

  
  


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  Non-Farm Payrolls (NFP): Forecast to show +50k jobs. This will be the most significant release of the week, as it could influence the Fed’s timing for the next rate cut. A weak number may bring rate cuts forward.

  
  

Conclusion

October kicks off with no shortage of market-moving events. From the potential U.S. government shutdown to central bank meetings and the all-important U.S. jobs data, traders and investors should brace for a volatile week.

For those with exposure to GBP, EUR, or USD, staying proactive with FX strategy will be key in navigating what’s ahead