This week is packed with major economic events across key markets, focusing on growth, inflation, and consumer confidence data. In Europe and the U.K., investors will monitor PMI data, fiscal policy updates from Germany, and inflation and budget reports from the U.K. While inflation is expected to ease slightly, the Bank of England’s monetary policy remains cautious, with ongoing uncertainty about the timing of rate cuts.
In the U.S., market participants will closely watch speeches from several Federal Reserve officials, as strong or weak economic data could influence the Fed’s plans for rate cuts later this year.
Monday
The week begins with the release of flash services and manufacturing PMI data for the eurozone, the U.K., and the U.S. The consensus suggests a general improvement, supporting investor optimism, particularly with Germany’s plans for fiscal easing. However, uncertainty surrounding Trump’s proposed tariffs remains a challenge for markets.
In the U.K., BoE Governor Andrew Bailey will deliver a speech on the British economy at the University of Leicester. While he may take audience questions, market impact is expected to be minimal unless he provides fresh insights into monetary policy.
Tuesday
In the U.S., focus will shift to CB Consumer Confidence, projected to decline to 94.2 from 98.3. The recent drop reflects household concerns over government spending cuts affecting jobs and social services, alongside fears of rising prices due to potential tariffs.
Additionally, new home sales data and the Richmond manufacturing index will provide further insights into the strength of the housing and manufacturing sectors.
Wednesday
In the U.K., annual CPI is expected to drop to 2.9% from 3.0%, while core CPI may decline to 3.6% from 3.7%. With energy prices no longer providing deflationary relief, inflation could approach 4% in H2 2024.
In Australia, monthly CPI rose by 2.5% y/y in January, aligning with expectations. A slight slowdown in inflation could give the Reserve Bank of Australia more room for policy adjustments.
In the U.S., core durable goods orders are forecast to rise 0.4% m/m, while overall durable goods orders are expected to drop 0.6%, following a 3.2% surge last month.
Thursday
The focus shifts to the U.S. as the final GDP q/q figures and pending home sales data are released. Growth figures are expected to remain relatively stable despite external pressures such as global trade policies and supply chain disruptions.
Friday
In the U.K., retail sales data will provide insights into consumer spending trends amid inflationary pressures. Meanwhile, Canada will publish its monthly GDP report, a key indicator of economic activity.
In the U.S., several high-impact reports will be released:
Core PCE Price Index is expected to rise 0.3% m/m, a key metric influencing the Fed’s rate decisions.
Personal income and spending data: Income is projected to rise 0.4% (down from 0.9%), while spending is expected to rebound 0.6% from the previous -0.2% decline.
Revised University of Michigan consumer sentiment will offer insights into consumer behavior in the coming months.
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