Diego Thomazini
US
It will be a busy week filled with a wide range of economic indicators, lots of Fed speak, and earnings season heats up. Wall Street will now not just fixate on inflation data, but also on how quickly the economy softens.
Traders will pay close attention to the Empire manufacturing index, retail sales, PPI, industrial production, NAHB housing market index, weekly jobless claims, and existing home sales data.
Fed speak will happen all week long and expectations are high for more members to signal they are comfortable with downshifting their tightening pace again.
Earnings season continues with more bank earnings, the airline’s report, Procter & Gamble (PG) earnings will include insights on pricing trends, and Fastenal reports.
EU
The run-up to the February ECB meeting is going to bring immense focus on incoming data and central bank speak, with investors becoming increasingly hopeful that global interest rates may nearly be peaking and perhaps not as high as feared even a couple of weeks ago. On the former, the standout release will be the final inflation number for December while the ZEW surveys will also be of interest.
On the latter, the ECB minutes will be poured over, as will comments from President Christine Lagarde and colleagues towards the end of the week. Markets are still pricing in three 50 basis point hikes at the upcoming meetings but that could be pared back.
UK
So it turns out the UK may have just about avoided a technical recession in 2022 thanks to the World Cup. The GDP data for November showed unexpected growth which, when combined with the 0.5% gain in October makes it unlikely that the economy will have fallen into a recession after all, barring surprise downward revisions or a shocking number in December. Perhaps Gareth Southgate will get that knighthood after all.
Ultimately, it makes no difference. The spending that boosted November’s number will probably simply be shifted from elsewhere. The cost-of-living crisis is squeezing the economy and will likely further intensify this year, potentially tipping the economy into recession, anyway. We’ll get a lot more data this week including unemployment, inflation, and retail sales.
Russia
No data or events are scheduled for next week so the focus will remain on developments in Ukraine.
South Africa
The currency has stabilized after tumbling last week amid speculation around the changing of the SARB mandate. While the ANC hasn’t given up hope, any changes are unlikely, for the foreseeable future, anyway. That leaves investors to focus on the inflation and retail sales data next Wednesday, the first of which still sits above the SARB 3-6% target range.
Turkey
The CBRT meets next week and frankly, I have no idea what they will do. Official inflation fell from 84.39% to 64.27% in December which the central bank could look to capitalise on, despite previously indicating it was done with its latest easing cycle.
Switzerland
The World Economic Forum takes place in Switzerland next week and on Friday, SNB Chair Thomas Jordan will be among many central bankers throughout the week making an appearance.
China
All eyes will be on China this week. To kick off the week, the PBOC is expected to cut its one-year MLF rate by 10 basis points to 2.65%. On Tuesday, we see the impact Covid had on GDP, industrial production, retail sales, and fixed asset investment. Fourth quarter GDP is expected to drop from 3.9% to 1.5%, while December’s retail sales plunge from -5.9% to -12.0%. At the end of the week, China is expected to cut its loan prime rates.
Much attention will remain on China’s Covid situation and whether the economic outlook continues to brighten with improving reopening trends.
India
Inflation has been falling and that is starting to make some traders doubt that the RBI will need to continue to raise rates. The upcoming week contains wholesale price data that is expected to show disinflation trends remain. Trade data is also due.
Australia & New Zealand
China’s reopening momentum has been good news for both Australia and New Zealand. China-Australia relations are expected to return to a healthy and stable development, with China’s ambassador Xiao Qian recently commenting positively on China-Australia relations. The relationship has been constructive so far. The main economic release for Australia will be the December employment report. Hiring is expected to slow down from 64,000 to 15,000.
For New Zealand, traders will pay close attention to the REINZ House Sales data, Food prices, and manufacturing PMI.
Japan
The Bank of Japan’s monetary policy decision is expected to keep rates on hold. Traders are still digesting the surprising decision to adjust its government bond yield curve control. BOJ watchers are looking for hints that they could soon move toward normalization by the end of July.
Next week also focuses on the Japan PPI, machine tool orders, Tertiary industry index, core machine orders, industrial production, and trade data.
Singapore
Second-tier data includes the release of non-oil domestic exports for December.
Economic Calendar
Saturday, Jan. 14
Economic Events
Second and final day of voting for Czech president
Assistant Trade Representative McCartin leads a US delegation in trade talks with Taiwan counterparts in Taipei.
Sunday, Jan. 15
Economic Data/Events
No major events expected
Monday, Jan. 16
Economic Data/Events
US markets closed for Martin Luther King Day
Australia inflation gauge
Canada existing home sales
China property prices, medium-term lending
India wholesale prices
Japan PPI, machine-tool orders
UK Rightmove house price index
The World Economic Forum’s annual meeting kicks off in Davos, Switzerland
EU finance ministers meet in Brussels
Tuesday, Jan. 17
Economic Data/Events
US Empire State manufacturing survey
Australia consumer confidence
Canada CPI, housing starts
China retail sales, industrial production, GDP, surveyed jobless rate
Germany CPI, ZEW survey expectations
Italy CPI
Japan tertiary industry index
Mexico international reserves
New Zealand house sales
Singapore trade
South Korea money supply
UK jobless claims, unemployment
Fed’s Williams gives speaks at an event about equitable growth hosted by the bank
ECB’s Centeno participates in a panel at the World Economic Forum in Davos
Big earnings from Goldman Sachs, Morgan Stanley, and United Airlines
Wednesday, Jan. 18
Economic Data/Events
US retail sales, PPI, industrial production, business inventories, MBA mortgage applications, cross-border investment
Fed release Beige Book
BOJ rate decision: Expected to keep rates on hold
Eurozone CPI
South Africa CPI
UK CPI
Canada industrial product prices
Italy trade
Japan machinery orders, industrial production
New Zealand card spending
South Africa retail sales
Taiwan jobless rate, GDP
Thailand car sales
NATO Military Committee in Chiefs of Defence session opens
Fed’s Bostic gives welcoming remarks at a conference on model risk management hosted by the bank
Fed’s Logan speaks at the University of Texas Austin McCombs School of Business
Fed’s Harker speaks at the Lyons CEEE Economic Forecast event
Alcoa report earnings
Thursday, Jan. 19
Economic Data/Events
US housing starts, initial jobless claims, Philadelphia Fed index
Norway Rate Decision: May hold rates or deliver a 25bp rate increase
Turkey Rate Decision: Expected to keep the one-week repo rate unchanged at 9.00%
Argentina trade
Australia unemployment
China Swift global payments
Japan trade
New Zealand food prices
Spain trade
ECB publishes the account of its December 2022 policy meeting
ECB President Christine Lagarde speaks in a panel at World Economic Forum in Davos
ECB’s Schnabel speaks in a webinar on monetary policy
Fed’s Collins speaks at a conference on housing hosted by the bank
Fed’s Williams speaks at an event hosted by the Fixed Income Analyst Society in NY
France’s main labor unions’ first day of strikes over the government’s plan to raise the retirement age
Procter & Gamble and Netflix (NFLX) report earnings
Friday, Jan. 20
Economic Data/Events
US existing home sales
BOJ announce outright purchase total of government securities
Japan CPI
Canada retail sales
China loan prime rates
Germany PPI
Mexico retail sales
New Zealand PMI, net migration
Thailand foreign reserves, forward contracts
UK retail sales
ECB President Christine Lagarde and French Finance Minister Bruno Le Maire speak on a panel in Davos
Schlumberger and American Airlines report earnings
Sovereign Rating Updates
Hungary (Fitch)
Ireland (Fitch) – Norway (Fitch)
Austria (DBRS)
EFSF (DBRS)
ESM (DBRS)
Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.
Be the first to comment