Week’s main events (February 23 – February 27)

The technology sector will dominate the upcoming week on the financial markets: Nvidia’s earnings report will be a key indicator of global interest in artificial intelligence, which has long been the main driver of US indices. In the US macroeconomic bloc, investors will focus on producer price and consumer confidence data to assess the stability of the world’s largest economy. At the same time, Europe and the Asia-Pacific region will release new inflation data, and several countries will publish fourth-quarter GDP figures, helping clarify the pace of the global economic slowdown.

Particular attention will be paid to regulators‘ actions in Asia, where the People’s Bank of China (PBoC) will set lending rates after the New Year holidays to stimulate domestic activity. Geopolitical factors also remain a key source of uncertainty this week, as markets closely monitor developments in negotiations between Tehran and Washington. Any escalation of the confrontation could trigger a sharp jump in energy prices, with oil traditionally being the most sensitive asset.

Monday, February 23

On Monday, the two most significant events are the German Ifo Business Climate and ECB President Christine Lagarde’s speech. The Ifo index is forecasted to remain under pressure around 87.9-88.4, reflecting a German economy struggling with stagnation. A reading below these expectations would signal further industrial weakness, potentially weighing on the EUR and boosting demand for German Bunds as a safe haven. Simultaneously, ECB President Lagarde will likely address persistent trade uncertainties and the timeline for stabilizing inflation at the 2% target. If her tone remains cautious or „dovish“ regarding growth risks, it could further weaken the euro against the USD.

Main events of the day:

– Singapore Inflation Rate (m/m) at 07:00 (GMT+2); – SGD (MED)
– German Ifo Business Climate (m/m) at 11:00 (GMT+2); – EUR (MED)
– Mexico GDP (q/q) at 14:00 (GMT+2); – MXN (MED)
– Eurozone ECB President Lagarde Speaks at 19:30 (GMT+2). – EUR (MED)

Tuesday, February 24

On Tuesday, the most critical events are the China PBoC Loan Prime Rate (LPR) announcement and the US CB Consumer Confidence index. Following the Lunar New Year, the PBoC is expected to keep the 1-year LPR at 3.0% and the 5-year LPR at 3.5%, though markets are closely watching for a surprise cut to stimulate the property sector. If the PBoC remains „on hold,“ it may signal a cautious approach to stimulus, potentially stabilizing the CNY but limiting upside for the China 50 Index. In the US, the Conference Board Consumer Confidence is forecasted to rebound to 86 after a sharp January slump to 84.5. This release is a high-impact „leading indicator“ for consumer spending; a beat would reinforce the „higher-for-longer“ interest rate narrative, providing strong support for the USD and weighing on Gold. However, if the index fails to recover, it would heighten fears of a cooling economy, potentially triggering a sell-off in the US indices and fueling expectations for a Fed rate cut in the coming months.

Main events of the day:

– China PBoC Loan Prime Rate at 03:00 (GMT+2); – CHA50, HK50 (HIGH)
– UK Monetary Policy Report Hearings at 16:15 (GMT+2); – GBP (LOW)
– US CB Consumer Confidence (m/m) at 17:00 (GMT+2). – USD (MED)

Wednesday, February 25

On Wednesday, the most impactful data points are the Australia Consumer Price Index (CPI) and the Eurozone Final CPI readings. In Australia, the annual inflation rate is expected to remain sticky at 3.7%-3.8%, staying well above the RBA’s 2-3% target range. Following Governor Bullock’s recent hawkish stance and a surprise rate hike to 3.85% earlier this month, a high reading would reinforce expectations of another hike in May. This would likely strengthen the AUD as market prices in a more aggressive RBA compared to other central banks. In the Eurozone, the final core CPI for January is forecast to be confirmed at 2.2%, marking a return to the ECB’s target. While „final“ readings often confirm the preliminary ones, any upward revision would be a significant „hawkish“ surprise, potentially boosting the EUR by dampening hopes for immediate spring rate cuts. Conversely, confirmation of the cooling trend, combined with expected weak German GDP data (forecast at 0.3%-0.4% YoY) released earlier that morning, could weigh on the Euro, highlighting the stark contrast between falling prices and stagnant growth.

Main events of the day:

– Australia Consumer Price Index (m/m) at 02:30 (GMT+2); – AUD (HIGH)
– German GDP (q/q) at 09:00 (GMT+2); – EUR (MED)
– German GfK Consumer Confidence (m/m) at 09:00 (GMT+2); – EUR (LOW)
– Hong Kong Inflation Rate (m/m) at 10:30 (GMT+2); – HKD (MED)
– Australia RBA Gov Bullock Speaks at 10:40 (GMT+2); – AUD (LOW)
– Eurozone Consumer Price Index (m/m) at 12:00 (GMT+2); – EUR (MED)
– US Crude Oil Reserves (w/w) at 17:30 (GMT+2). – WTI (HIGH)

Thursday, February 26

On Thursday, the primary focus shifts to the health of the US labor market and the energy sector with the US Initial Jobless Claims and Natural Gas Storage reports. Following a surprisingly strong drop to 206,000 in the previous week, jobless claims are forecasted to stabilize around 210,000. A result that remains near these multi-month lows would provide further evidence of a resilient labor market, reinforcing the „hawkish“ narrative that the Federal Reserve has no immediate pressure to cut rates. This would likely strengthen the USD and put downward pressure on Gold and US Treasuries. In the energy markets, the EIA Natural Gas Storage report is expected to show a withdrawal of approximately 144–148 Bcf. While this represents a seasonal decline, recent data show that inventories are starting to erase their deficit compared to the five-year average. A smaller-than-expected withdrawal would be seen as „bearish,“ potentially driving Natural Gas prices down.

Main events of the day:

– Eurozone ECB President Lagarde Speaks at 10:30 (GMT+2); – EUR (LOW)
– US Initial Jobless Claims (w/w) at 15:30 (GMT+2); – USD (MED)
– US Natural Gas Storage (w/w) at 17:30 (GMT+2). – XNG (HIGH)

Friday, February 27

A lot of economic news is expected on Friday. The market focus centers on the Tokyo Core CPI, Canada’s GDP, and the US PPI. In Japan, Tokyo’s Core CPI is forecasted to slow significantly to 1.7% from 2.0%, primarily due to government utility subsidies. This drop below the Bank of Japan’s 2% target would likely cool expectations for an April rate hike, potentially weakening the JPY. On the other side of the Pacific, Canada’s fourth-quarter GDP is expected to show moderate monthly growth of 0.1%, with the quarterly figure likely to be negative. A result in line with or above this forecast would indicate that the Canadian economy is weathering the period of high interest rates better than feared, which could provide support for the Canadian dollar despite recent trade uncertainty. But if the data turns out to be worse than expected, the Canadian could come under heavy pressure. In the US, the Producer Price Index (PPI) is forecast to rise 0.3% month-on-month, maintaining an annual growth rate of around 3.0%. After stronger-than-expected growth in service prices and core PPI last month (which reached 3.3%), markets are extremely sensitive to “persistent” inflation. A higher-than-expected reading would signal that inflationary pressures are still spreading through the production chain, likely pushing up US Treasury yields and strengthening the dollar, as it would push back any Fed rate cuts to the second half of the year.

Main events of the day:

– Japan Tokyo Core CPI (m/m) at 01:30 (GMT+2); – JPY (MED)
– Japan Industrial Production (m/m) at 01:50 (GMT+2); – JPY (LOW)
– Japan Retail Sales (m/m) at 01:50 (GMT+2); – JPY (MED)
– Switzerland Retail Sales (m/m) at 09:30 (GMT+2); – CHF (LOW)
– Switzerland GDP (q/q) at 10:00 (GMT+2); – CHF (MED)
– Switzerland KOF Leading Indicators (m/m) at 10:00 (GMT+2); – CHF (LOW)
– German Unemployment Rate (m/m) at 10:55 (GMT+2); – EUR (LOW)
– German Consumer Price Index (m/m) at 15:00 (GMT+2); – EUR (MED)
– Canada GDP (q/q) at 15:30 (GMT+2); – CAD (MED)
– US Producer Price Index (m/m) at 15:30 (GMT+2); – USD (HIGH)
– US Chicago PMI (m/m) at 16:45 (GMT+2). – USD (MED)

by JustMarkets, 2025.02.23

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