All eyes on the Fed

This week has been relatively quiet in commodity markets, but there could be some bigger moves in prices in the next seven days given that the Fed meets on Thursday and a raft of economic data is scheduled for release. We think that the Fed will cut interest rates for a third consecutive time at the conclusion of its policy meeting on Wednesday. However, the cut is all-but priced into markets. As such, we would only expect a significant reaction in commodity prices if the Fed leaves rates on hold. • Staying with the US, the October employment report (Friday) will not be too informative as it will be distorted by the strike at GM. However, we suspect that the ISM manufacturing index (also Friday) will be more upbeat than September’s unusually low reading, which may give commodity prices a lift. But positive news on the US may be ignored if, as we expect, the Chinese October PMIs (Thursday/Friday) ease back. • More parochially, next week is LME week in London, which may provide some distraction from Brexit! We will in due course discuss the main topics addressed at the many events.