Central Banks Take Center Stage as Fed Decision Looms Large

The upcoming week is set to be dominated by monetary policy decisions from major central banks. The Federal Reserve (Fed) in the US, Bank of England (BoE), and Bank of Japan (BoJ) will all make key announcements. The Fed decision on Wednesday is expected to be a lighter meeting, with no updated projections or dot plot, but still significant for market guidance.

The Fed's target range is widely anticipated to remain unchanged at 3.50%, 3.75%. This will be followed by a major batch of US releases on Thursday, including preliminary second-quarter GDP and monthly Core PCE inflation. Stronger growth or persistent inflation could support the Fed's restrictive stance.

The Eurozone will also face a busy domestic calendar, with German IFO surveys and broader Eurozone inflation data due out this week. The Euro is expected to be sensitive to the Fed decision and US Dollar movements, as well as its own economic releases. Stronger growth and inflation figures could support the Euro by reducing expectations of additional European Central Bank (ECB) easing.