It’s a very big week for the US, both in terms of events and data. The Federal Reserve is holding its policy meeting on Wednesday – the same day senior Chinese and US trade delegations will commence two days of negotiations in Washington.
Also the US Department of Commerce’s Bureau of Economic Analysis and Census Bureau are now updating their websites and publishing economic data following the (temporary) suspension of the government shutdown. Markets, partly deprived of tier-one US macro data in recent weeks, will have to contend with Consumer confidence numbers (Tuesday), January ADP employment, Q4 GDP and December pending home sales data (Wednesday), personal income, spending and PCE inflation numbers (Thursday) and ISM manufacturing PMI and all-important non-farm payrolls figures for January (Friday).
In the UK the focus remains squarely on the issue of Brexit, with the House of Commons due to vote tomorrow on a number of draft Brexit bill amendments. The Eurozone data calendar has two major (preliminary) releases – Q4 GDP (Thursday) and CPI-inflation (Friday).
On the other side of the world, Australia will release a number of key data, including NAB Business Confidence, private sector credit and in particular Q4 CPI-inflation (on Wednesday).
Monday 28th January
United Kingdom: Bank of England Governor Carney to speak. MPC member Broadbent suggested last week that the Bank of England could hike rates further in the event of the UK departing the EU in an orderly fashion.
Eurozone: European Central Bank President Draghi to speak.
New Zealand: Trade balance (December)
Tuesday 29th January
Australia: NAB Business Confidence (December)
United Kingdom: House of Commons will vote on a number of draft Brexit bill amendments, including renegotiating with the EU some of the terms and conditions of the draft Withdrawal Agreement (in particular the Northern Irish backstop) and asking the EU to extend the triggering of Article 50 by up to nine months (so that UK would not leave the EU on 29th March). These amendments are not legally binding for the government but it would be difficult for Theresa May to ignore an amendment which received a majority backing of MPs.
United States: Conference Board Consumer Confidence (January). Consumer confidence hit a multi-year high in September but subsequently fell in all three subsequent months and US retail sales growth, while still positive, has cooled a little.
Wednesday 30thJanuary
Australia: CPI-inflation (Q4)
Switzerland: KOF leading indicator (January)
United States: First day of meetings in Washington between Chinese trade delegation led by Vice-Premier Liu and US Trade Representative Robert Lighthizer. Hope is that both sides will reach an agreement to avoid the 1st March deadline being missed and the US administration carrying out its threat to hike its tariffs on $200bn of Chinese imports to 25% from 10%.
United States: ADP private sector non-farm employment change (January).
United States: Q4 GDP (first reading). Consensus forecast is that US GDP growth slowed further in Q4, to 2.5% qoq annualised, from 3.4% in Q3 and 4.2% in Q2.
United States: Pending home sales (December).
United States: Federal Reserve policy meeting. The Fed will most likely keep its policy rate unchanged and focus will be on the accompanying statement and press conference. In particular markets will be looking for vindication that, as per the recent statements of a number of FOMC members including Chairperson Powell, the Fed is far less inclined (compared to only a couple of months ago) to hike rates further.
Thursday 31st January
Australia: Private sector credit (December).
Eurozone: German retail sales and unemployment rate (December).
Eurozone: GDP (Q4, preliminary data). GDP growth in the Eurozone slowed from 0.4% in Q2 to 0.16% qoq in Q3 – its slowest rate since Q1 2013 – and the consensus forecast is that there was little recovery in the last quarter of 2018.
United States: Personal income, spending and PCE inflation (December).
United States: Second day of meetings in Washington between Chinese Vice-Premier Liu and US Trade Representative Robert Lighthizer.
Friday 1st February
Switzerland: Retail sales (December)
Eurozone: CPI-inflation (January, preliminary data). Headline CPI-inflation has hovered around 1% yoy since mid-2015 which has led to markets questioning the ECB’s monetary policy stance.
United States: Labour market data, including change in non-farm payrolls (January).
United States: ISM manufacturing PMI (January).
