A rarely seen “super week” of central banks is colliding with a rapidly rising geopolitical risk premium linked to developments in the Middle East. The event calendar is exceptionally packed and includes rate decisions from the Fed (Wednesday), the ECB (Thursday), and the BOJ (Thursday), a major catalyst for the technology sector in the form of Nvidia’s GTC AI conference (Monday–Thursday), and a political component in the form of the EU Foreign Affairs Council meeting focused on the Middle East. At the same time, the oil market is pricing in tail risks of prolonged disruptions to key transport routes. Key markets to watch: OIL, US500, USDJPY.
OIL
Oil remains the clearest barometer of the current tensions in the Middle East. However, the market risk is no longer only about volatility, but primarily about the duration of disruptions and how quickly global oil flows will be able to adjust. In recent days, Brent briefly traded above the 100 USD level, and investment banks are raising short-term price forecasts, assuming that geopolitical tensions and risks to energy infrastructure will keep the market in a tight supply environment. Upcoming macro events could further amplify moves in either direction: Chinese retail sales and industrial production data (Monday) will provide signals for demand, followed by decisions from the Fed, ECB, and BOJ, which will influence the US dollar and broader financial conditions.
US500
US equities are currently at the center of three opposing forces: signals from monetary policy, the AI narrative, and geopolitical risk. The Fed decision and Jerome Powell’s press conference (Wednesday) will be the key event of the week for equity investors. The market will watch whether the committee emphasizes a “higher for longer” scenario due to inflation risks (especially if oil prices remain elevated), or whether it sees sufficient signs of economic slowdown to leave room for future rate cuts. At the same time, Nvidia’s GTC conference (Monday–Thursday) may once again strengthen the artificial intelligence narrative through announcements of new products, technology roadmaps, and presentations by CEO Jensen Huang.
USDJPY
The Bank of Japan’s decision (Thursday) and Governor Kazuo Ueda’s press conference will be analyzed by the market for signals about the durability of inflation in Japan and the impact of global commodity shocks. At the same time, the Fed decision (Wednesday) will determine the direction of US bond yields, which remain a key driver for the dollar. In practice, the pair should be analyzed this week in a “two-step” framework — first the Fed decision, then the BOJ — and only after both announcements are known can a stronger directional move be expected.
Daily summary: Week ends with Brent at 100$ and indices in the red
AUDUSD loses nearly 1% 📉
Amazon: The Beginning of the End of AI Dreams?
BlackRock has a problem, but not a crisis
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.
