Week’s main events (February 12 – February 16)

Investors and traders will watch closely this week for new inflation data in the United States, the United Kingdom, and Switzerland. Inflationary pressures are expected to decline further in the United States, which may increase the likelihood that the FOMC will cut rates soon. But any signs of recovering price pressures could push bets on a rate cut further into the future. In the UK, inflation data is expected to show no signs of a slowdown, likely forcing the Bank of England (BoE) to hold high rates for longer. Inflation is likely to fall in Switzerland, which may lead to a softer stance of the SNB. Also coming out this week will be GDP data from Japan, the Eurozone, and the UK. It is the broadest measure of economic activity and a key indicator of the economy’s health. And, of course, traders should not miss the data on the labor market in the UK and Australia. A strong labor market will push the probability of a rate cut further away, which, as a rule, has a positive effect on the national currency.

Monday, February 12

On Mondays, traders should pay attention to speeches by central bankers. Very often, such speeches give hints about further steps in monetary policy. It’s a bank holiday in Japan, Singapore, Hong Kong and China.

Main events of the day:

– New Zealand RBNZ Gov Orr Speaks at 02:30 (GMT+2);
– Indian Consumer Price Index (m/m) at 14:00 (GMT+2);
– US FOMC Member Bowman Speaks at 16:20 (GMT+2);
– US FOMC Member Kashkari Speaks at 20:00 (GMT+2);
– UK BoE Gov Bailey Speaks at 20:00 (GMT+2).

Tuesday, February 13

Various statistics for many countries are expected on Tuesday. The main event will be inflation data in the United States, where a further decrease in price pressure is expected. Inflation is expected to fall from 3.4% to 2.9% annually. Investors should also be attentive to the UK labor market data, which is expected to show wage growth slowing as the labor market cools. However, it may still be too robust, which is undesirable for the Bank of England’s policy. Switzerland will publish its inflation report. Consumer prices are expected to decline from 1.7% to 1.4% annually, which may lead to a softer stance of the SNB. It’s a bank holiday in Hong Kong and China.

Main events of the day:

– Japan Producer Price Index (m/m) at 01:50 (GMT+2);
– New Zealand Inflation Expectations (m/m) at 04:00 (GMT+2);
– UK Average Earnings Index (m/m) at 09:00 (GMT+2);
– UK Claimant Count Change (m/m) at 09:00 (GMT+2);
– UK Unemployment Rate (m/m) at 09:00 (GMT+2);
– Switzerland Consumer Price Index (m/m) at 09:30 (GMT+2);
– German ZEW Economic Sentiment (m/m) at 12:00 (GMT+2);
– Eurozone ZEW Economic Sentiment (m/m) at 12:00 (GMT+2);
– US Consumer Price Index (m/m) at 15:30 (GMT+2).

Wednesday, February 14

The main event on Wednesday will be the Consumer Price Index in the United Kingdom. UK inflation is expected to rise from 4% to 4.1% y/y. Сonsumer price index data could further complicate the outlook for monetary policy. The Bank of England believes inflation will return to the 2% target this year but warned that short spikes in inflation are possible. Investors should also focus on the UK BoE Gov Bailey Speak speech. Also not to be missed is Eurozone GDP data, which will show how the bloc’s economy responds to high interest rates. It’s a bank holiday in China.

Main events of the day:

– UK Consumer Price Index (m/m) at 09:00 (GMT+2);
– UK Producer Price Index (m/m) at 09:00 (GMT+2);
– Eurozone GDP (q/q) at 12:00 (GMT+2);
– Eurozone Industrial Production (m/m) at 12:00 (GMT+2);
– UK BoE Gov Bailey Speaks at 17:00 (GMT+2);
– US Crude Oil Reserves (w/w) at 17:30 (GMT+2).

Thursday, February 15

Thursday’s main event will be the labor market data in Australia. Australia’s labor market is expected to remain robust, increasing the likelihood that the RBA will hold rates longer than the market expects. This would be an optimistic scenario for the Australian dollar. Also, traders should closely monitor the US Retail Sales data. This is a crucial indicator of consumer spending, accounting for most of overall economic activity. A rise in sales is usually associated with stability and leads to a stronger dollar. Also, on Thursday, UK GDP data will be released, showing that the economy is expected to contract over the past month, increasing the likelihood of the UK slipping into recession. It’s a bank holiday in China.

Main events of the day:

– Japan GDP (q/q) at 01:50 (GMT+2);
– Australia Unemployment Rate (m/m) at 02:30 (GMT+2);
– Japan Industrial Production (m/m) at 06:30 (GMT+2);
– UK GDP (q/q) at 09:00 (GMT+2);
– UK Industrial Production (m/m) at 09:00 (GMT+2);
– UK Trade Balance (m/m) at 09:00 (GMT+2);
– Switzerland Producer Price Index (m/m) at 09:30 (GMT+2);
– Eurozone ECB President Lagarde Speaks at 10:00 (GMT+2);
– Eurozone Trade Balance at 12:00 (GMT+2);
– US Retail Sales (m/m) at 15:30 (GMT+2);
– US Initial Jobless Claims (w/w) at 15:30 (GMT+2);
– US NY Empire State Manufacturing Index (m/m) at 15:30 (GMT+2);
– US Philadelphia Fed Manufacturing Index (m/m) at 15:30 (GMT+2);
– US Industrial Production (m/m) at 16:15 (GMT+2);
– US Natural Gas Storage (w/w) at 17:30 (GMT+2);
– New Zealand RBNZ Gov Orr Speaks at 20:40 (GMT+2).

Friday, February 16

On Friday, traders should focus on producer inflation data in the United States. This indicator shows the level of inflation between factories and manufacturers and is a leading indicator of consumer inflation. PPI growth is likely to lead to CPI growth in the future, which is positive for the dollar and negative for stock indices. Also, on Friday, there will be speeches by some FOMC representatives who can provide hints about further actions by the US Federal Reserve. It’s a bank holiday in China.

Main events of the day:

– UK Retail Sales (m/m) at 09:00 (GMT+2);
– US Building Permits (m/m) at 15:30 (GMT+2);
– US Producer Price Index (m/m) at 15:30 (GMT+2);
– US Michigan Consumer Sentiment (m/m) at 17:00 (GMT+2);
– US FOMC Member Daly Speaks at 19:10 (GMT+2).

by JustMarkets, 2024.02.12

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