MNI Global Week Ahead November 2 - 6

Key Things to Watch For:

• Thursday, November 5 – Bank of England Policy Decision
  
  • The BOE meets amid a sharp increase in Covid-19 infections and a service-driven slowdown, boosting expectations that Threadneedle Street's policymakers will ease policy further.
  • While too early for the Bank to move towards negative rates -- the consultation period doesn't end until mid-November -- the BOE will likely further increase levels of QE.
• With no firm guidance on the MPC's rule of thumb, estimates range from GBP55 billion to GBP100 billion of additional firepower.

• Thursday, November 5 – FOMC Policy Decision
  • No change in policy is anticipated at the meeting two days after the presidential election, and will not include an SEP update. Rates are on hold near zero and asset purchases are expected to continue at the current pace.
• Sources expect a detailed discussion of future balance sheet policy options that include ramping up QE, shifting purchases toward longer maturities, yield curve control and expanding the purchases of non-Treasury assets. The release of the meeting minutes after a three-week delay should shed more light on that.

• Friday, November 6 – U.S. Nonfarm Payrolls
  • Employment continued to grow through October, though the labor market recovery is still slowing after unprecedented improvement in the spring and summertime. Nonfarm payrolls should grow by 600,000 in figures due Friday, according to Bloomberg.
  • Weekly unemployment claims levels have softened in recent weeks, suggesting that employers increased staff through the month. But analysts note that claims being made under special provisions of the CARES Act are still surging, and roughly 23 million unemployed Americans are still receiving government support.
  • Hiring is thought to have slowed in mid-to-late October as Covid-19 case counts and hospitalization rates across the country skyrocketed and the many businesses were constrained by social distancing guidelines.
  • Private payrolls are set to grow 680,000 in October, according to Bloomberg.
• The unemployment rate in October likely fell to 7.7% from 7.9% in September.