Brexit-related votes are likely to once again dominate the British landscape next week, with Prime Minister May contemplating a third (and final?) parliamentary vote on her draft Brexit deal before the European Council Summit on 21st March. The Bank of England’s policy meeting, as well as labour market, CPI-inflation and retail sales data, are likely to play second fiddle.
The Federal Reserve policy meeting is the highlight of the week in the US while in the Eurozone the data calendar is reasonably quiet, with the exception of the German ZEW economic sentiment release and the Eurozone Composite PMI figure.
Monday 18th March
Australia: Reserve Bank of Australia Assistant Governor Kent to speak
Tuesday 19th March
Australia: Reserve Bank of Australia policy meeting minutes. The RBA is seemingly in a “wait-and-see” mode regarding its policy rate but the minutes may provide additional colour at the margin as to whether the RBA is leaning, even if very slightly, towards a cut or a hike.
United Kingdom: Labour market (January). The British labour market is strong but real wage growth remains subdued.
Germany: ZEW economic sentiment index (March). This index of economic activity has gradually improved from a multi-year low of -24.1 in November and the consensus forecast is that it rose again in March to -11.3 from -13.4 in February. If this proves correct it would indicate that German GDP growth may have inched higher in Q1 following almost zero growth in Q4 2018.
New Zealand: Current account balance (Q4 2018)
Wednesday 20th March
United Kingdom: CPI-inflation (February). With core CPI-inflation stable around 1.9% yoy since June, there is no compelling reason for the Bank of England to even consider hiking rates, particularly with the uncertainty surrounding Brexit and the outlook for the UK economy.
United Kingdom: House of Commons to vote a third time on Prime Minister May’s Brexit deal (tentative). It is still unclear whether Prime Minister has a legal basis to put forward her deal to parliament for a third vote.
United States: Federal Reserve policy meeting, statement, press conference and updated projections. The Fed is widely expected to leave rates on hold and to reiterate its message that it is patient yet flexible. The focus will likely fall on the new “dot-chart”, with the risk that FOMC members have once again revised downwards their expectations for rate hikes this year and next.
Thursday 21st March
Australia: Labour market (February). The labour market has been a bright spot on the Australian economic landscape with the economy having created about 180,000 job s since August. Consensus forecast is for another 14,500 jobs to have been added and as always the breakdown between full-time and part-time jobs will be of interest.
United Kingdom: Retail sales (February). This was until a few months ago a well tracked macro variable but with Brexit having become all-encompassing it has lost some of its market-moving power. Analysts expect a 0.4% mom contraction in the volume of retail sales in February, bearing in mind this is also a typically volatile series.
United Kingdom: Bank of England policy meeting. MPC members are seemingly divided as to whether the MPC could still potentially hike rates regardless of the outcome of Brexit. But with UK economic growth and inflation at best tepid, for the time policy being rates will remain on hold.
United States: Philadelphia Fed manufacturing index (March). This index, which historically has correlated quite closely with US GDP growth, was weak in January-February
Europe: European Council meeting of the 27 leaders of the European Union. On the agenda will be a possible request by British Prime Minister to delay Article 50 by at least three months, which requires the unanimous consent of the 27 heads of state.
Friday 22nd March
Eurozone: Composite PMI (March). The Eurozone economy has had little to cheer about in recent months and analysts forecast that this measure of economic was broadly stable in March at 49.2. If this proves correct it would suggest that Eurozone GDP growth may have not risen much from a lacklustre +0.2% qoq in Q4 2018.
