Markets enter the week on fragile footing. A partial US government shutdown has reintroduced political risk just as volatility was already creeping higher. With three central bank decisions, key inflation signals, and a pivotal US jobs report ahead, this week has the potential to reset expectations on where growth, inflation, and interest rates are really headed.

Monday, February 2

ISM Manufacturing PMI

The week begins with the ISM Manufacturing PMI, expected to print around 48.5. That keeps US manufacturing in contraction territory, but slightly higher than last month. In plain terms, factories are still struggling, though the pace of decline may be slowing. A small improvement would suggest conditions are stabilizing rather than worsening, while a weaker print would reinforce concerns that higher rates are continuing to weigh on industrial activity.

Tuesday, February 3

RBA Interest Rate Decision & US JOLTS Job Openings

The Reserve Bank of Australia sits front and center this week. Markets now expect a 25-basis-point rate hike, taking the cash rate from 3.60% to roughly 3.85%. The shift comes after inflation surprised to the upside late last year, particularly in the December quarter, pushing price growth outside the RBA’s comfort zone. If delivered, this move could set the tone for how other central banks think about staying restrictive for longer.

Also on Tuesday, the US JOLTS report is expected to show job openings holding around 7.0–7.1 million. That would confirm a labor market that is cooling but still functional. Demand for workers is no longer booming, but it has not broken either—an important signal ahead of Friday’s employment report.

Wednesday, February 4

ISM Services PMI

The ISM Services PMI is forecast to ease toward the 53.5–54 range. While that still points to expansion, it would mark a slowdown from December’s stronger pace. Because services dominate the US economy, this data helps investors judge whether growth is moderating smoothly or losing momentum more quickly than expected.

Thursday, February 5

BOE & ECB Interest Rate Decisions

Two major European central banks take the stage on Thursday. The Bank of England is expected to hold rates at 3.75%, with markets focusing less on this meeting and more on whether policymakers hint at rate cuts later in the spring. Inflation remains above target, and wage pressures are still present, giving the BoE room to stay patient.

The European Central Bank is also expected to leave rates unchanged. Eurozone inflation has moved closer to the ECB’s 2% target, and policymakers have signaled little urgency to adjust policy. Updated guidance will be watched closely for any shift in tone on the path ahead.

Friday, February 6

US Non-Farm Payrolls & Unemployment

The week culminates with the US jobs report. Payroll growth is expected to come in around 67,000, while the unemployment rate is seen holding near 4.4%. This points to a labor market that is slowing but not deteriorating. For investors, that balance matters. Steady employment alongside sticky inflation keeps the Federal Reserve cautious and reinforces the idea that rate cuts are still some distance away.

Key Corporate Earnings This Week

• Tuesday, February 3: AMD (after market close)
• Wednesday, February 4: Alphabet (after market close)
• Thursday, February 5: Amazon (after market close)

Technical Outlook

EUR/USD

The pair remains capped under a long-term bearish trend that’s been in place since 2018. The most recent weekly candle offered little encouragement, with a shooting star formation followed by a sharp dip of nearly 200 pips. From here, reclaiming those losses and holding firmly above 1.20 is critical for any meaningful improvement in outlook.

Nasdaq

A double top has formed on the daily chart, and last week’s price action largely confirmed the downside move. A fresh high would invalidate the pattern, while a break below $23,800 could intensify selling pressure.

Disclaimer

The information in this article is for general information only and does not represent financial or investment advice. Markets are unpredictable, and past performance does not guarantee future results. Before making any financial decisions, please do your own research or consult a licensed financial advisor. We are not responsible for any loss or damage caused by reliance on this content.