Fresh from the US interest rate hike earlier this morning, our attention now turns to Japan and the UK for their interest rate meetings. There is also some important US data coming out later tonight as well.

The Japanese monetary policy decision is up first. There has been little to no talk of Japan raising interest rates. Inflation is the key for the central bankers as they want to see an increase in this figure before even considering a change in monetary policy. Inflation remains weak in the economy. Central bankers are scratching their heads as they try to resuscitate inflation. Interest rates are in negative territory, the money printing presses have run out of ink and BoJ’s bond buying program is running the risk of nationalising the whole economy. Government intervention has distorted the markets and the Yen. It’s hard to see what the BoJ can do differently than what they are doing now, because if they remove all of that government support, it could send the markets into free fall.

Later tonight, our attention turns to the UK and their monetary policy meeting. Like the Japanese economy, the UK faces its own inflationary problems, but for different reasons. Since the Brexit referendum, there has been a large devaluing of the Pound. This has caused inflation to spike. The trick for central bankers in the UK is to balance monetary policy enough to keep a lid on inflation and to keep economic growth going. If they raise interest rates too quickly, they run the risk of sending the country into a recession, as people and businesses stop spending, which halts growth. On the other hand, if BoE waits too long to raise rates, inflation could spike to unsustainable levels. How the BoE manage these challenges is what will have markets keenly waiting. Also look for the language the BoE Governor, Mark Carney, uses when delivering the BoE’s decision. This can give a good indication of where the central bank sees monetary policy heading into the future.

As for announcements, there is a number of important pieces of data coming out of the US. This includes: Building Permits, Philly Fed Manufacturing Index, Unemployment Claims, Housing Starts, JOLTS Job Openings and Natural Gas Storage. The most important of these announcements is the Building Permits and the Manufacturing Index. The Building Permits data reflects the annualised number of new residential building permits issued in February. A strong number is important as it reflects consumers’ confidence in the economy because they are willing to outlay the money required to make their biggest purchase of their lives. The manufacturing number is crucial as it is a large part of the US economy, one in which President Donald Trump has promised to make more globally competitive.

Elsewhere around the world, Switzerland is releasing their monetary policy plans and Europe is publishing CPI & Core CPI data.