The stocks have hit a seemingly never-ending run of record highs in this summer. After that this September will bring a series of monetary and political events that could jolt investors out of their complacency. A showdown over U.S. national debt alongside crucial elections in Japan and Germany add to the risks. There are eight events, listed chronologically, which investors will watch in September such as,
TAPER DOWN UNDER — SEPT. 7
The Reserve Bank of Australia meets and provides September’s first test of central banks’ determination to stick with plans to cut stimulus. They have plans to reduced weekly bond buying to A$4 billion ($2.9 billion) in September. Yet the spread of the Delta variant and a slowing economy are piling pressure on the RBA.
ECB MEETS — SEPT. 9
European Central Bank meeting could be a lively affair. ECB policy can be arguing that now is the time to start debating the end of a stimulus scheme. The ECB might opt to slow the pace of purchases but chief Christine Lagarde will likely stress. Communicating this will not be easy. The risk is markets interpret such a step lifting the euro and sovereign borrowing costs.
CANADA ELECTION — SEPT. 20
Canadian Prime Minister Justin Trudeau called a snap vote two years early. He is now facing a tight race. Trudeau is hoping his management of the pandemic will get him a majority, but polls show his Liberals in a statistical tie with Erin O’Toole’s Conservatives. Canadian elections rarely register for global markets.
FED TAPER TIMELINE — SEPT. 21-22
August U.S. payrolls have not entirely derailed expectations. The Federal Reserve may announce a taper timeline at its September meeting. Fed boss Jerome Powell could stress again that tapering and rate increases are separate. He also regards that the current inflation spikes as transitory. Fed fund futures are pricing the first hike for early 2023.
NORWAY TO HIKE — SEPT. 23
Norway is set to raise interest off 0%, and becomes the first of the G10 group of developed economies to do like this. A rate hike will demonstrate its willingness. This is to look beyond rising COVID infections. Investors expect the rise. New Zealand unexpectedly baulked at raising in August and that would still mark a significant moment for markets hooked on cheap cash.
GERMANY VOTES — SEPT. 26
Western Europe’s longest-ruling incumbent leader, Angela Merkel, steps down as German chancellor after 16 years in charge and four straight election victories. The election has a wider-than-usual range of possible outcomes. Mainly because of the centre-left Social Democrats are leading in the opinion polls. They are pulling ahead of Merkel’s conservatives for the first time in 15 years.
JAPAN’S NEXT PREMIER — SEPT. 29
Prime Minister Yoshihide Suga’s decided to resign. This has given a surprise twist to Japanese politics. Amid the pandemic, Suga’s popularity had sunk. But still there is no frontrunner in the race to succeed him as chief of the ruling Liberal Democratic Party. Possibilities include ex-foreign minister Fumio Kishida and the popular minister in charge of Japan’s vaccination rollout, Taro Kono. The contest is slated for Sept. 29, and the winner must call the general election by Nov. 28.