Week’s main events (January 27 – January 31)

Economists predict that the European Central Bank (ECB), the Bank of Canada (BoC), and probably the Swedish Riksbank will cut interest rates by 25 bps. The Federal Reserve, on the other hand, will keep rates unchanged. Meanwhile, the US PCE deflator may pose some risk, but CPI and PPI have already signaled slight growth and a flat core reading. The US and Eurozone will also present the first GDP estimates for 4Q24. Later in the week, Japan will release the January Tokyo CPI, which is likely to accelerate.

Monday, January 27

China will release business activity data on Monday, which will show the health of the economy. In the European session, investors should pay attention to Ifo’s German business climate data. In the American session, the US will publish a report on the number of new homes.

Main events of the day:

– China Manufacturing PMI (m/m) at 03:30 (GMT+2);
– China Non-Manufacturing PMI (m/m) at 03:30 (GMT+2);
– Eurozone ECB President Lagarde Speech at 10:10 (GMT+2);
– German Ifo Business Climate (m/m) at 11:00 (GMT+2);
– US New Home Sales (m/m) at 17:00 (GMT+2);
– Switzerland SNB Chairman Schlegel Speaks at 23:25 (GMT+2).

Tuesday, January 28

On Tuesday, traders should focus on 2 main reports. The first is the business report from NAB in Australia. Weak figures may hurt the AUD. In the US session, traders will evaluate the Durable Goods Orders report. A slight increase is expected, which may support the USD.

Main events of the day:

– Australia NAB Business Confidence at 02:30 (GMT+2);
– US Durable Goods Orders (m/m) at 15:30 (GMT+2);
– US CB Consumer Confidence (m/m) at 17:00 (GMT+2).

Wednesday, January 29

Wednesday will be very rich for economic events, so high volatility is expected. At the Asian session in Australia, the inflation report will be released, where the rate is expected to rise from 2.3% to 2.5% y/y. Such data may push back the RBA’s plans to start cutting rates next month. Then, central banks will hold monetary policy meetings in Sweden and Canada. Both banks are expected to cut the rate by 0.25%. Rate cuts tend to be accompanied by pressure on the local currency, especially against those currencies where central banks keep rates higher. The US session will see the FOMC meeting. The US central bank is expected to leave rates unchanged, so the main focus will be on Jerome Powell’s speech regarding further plans to cut rates this year. The US Crude Oil Reserves data, which has an essential impact on oil prices, should also be in focus.

Main events of the day:

– Japan Monetary Policy Meeting Minutes at 01:50 (GMT+2);
– Australia Consumer Price Index (m/m) at 02:30 (GMT+2);
– Japan Consumer Confidence (m/m) at 07:00 (GMT+2);
– German GfK German Consumer Climate (m/m) at 09:00 (GMT+2);
– Sweden Riksbank Interest Rate Decision at 10:30 (GMT+2);
– UK BOE Gov Bailey Speaks at 16:15 (GMT+2);
– Canada BoC Interest Rate Decision at 16:45 (GMT+2);
– Canada BoC Monetary Policy Report at 16:45 (GMT+2);
– Canada BoC Press Conference at 17:30 (GMT+2);
– US Crude Oil Reserves (w/w) at 16:30 (GMT+2);
– US Fed Interest Rate Decision at 21:00 (GMT+2);
– US FOMC Statement at 21:00 (GMT+2);
– US Fed Press Conference at 21:30 (GMT+2).

Thursday, January 30

Thursday’s main event will be the ECB’s monetary policy meeting. It is expected that the ECB will continue to cut rates. While President Lagarde may be reluctant to make any preliminary promises, she will likely confirm market expectations for rate cuts. The swaps market is discounting about 100 bps of rate cuts this year, with nearly 75 bps coming in the year’s first half. Investor focus on Thursday will also be centered on US GDP data. Growth of 2.7% y/y is expected, down from 3.1% y/y last month but still a strong reading.

Main events of the day:

– Switzerland Trade Balance (m/m) at 09:00 (GMT+2);
– Switzerland KOF Leading Indicators (m/m) at 10:00 (GMT+2);
– Eurozone GDP (m/m) at 12:00 (GMT+2);
– Eurozone Unemployment Rate (m/m) at 12:00 (GMT+2);
– Eurozone ECB Interest Rate Decision at 15:15 (GMT+2);
– Eurozone ECB Monetary Policy Statement at 15:15 (GMT+2);
– US GDP (m/m) at 15:30 (GMT+2);
– US Initial Jobless Claims (w/w) at 15:30 (GMT+2);
– Eurozone ECB Press Conference at 15:45 (GMT+2);
– US Pending Home Sales (m/m) at 17:00 (GMT+2);
– US Natural Gas Storage (w/w) at 17:30 (GMT+2).

Friday, January 31

Japan will publish the Tokyo Inflation Report, a leading indicator of nationwide inflation. It is expected to rise slightly from 2.4% to 2.5% year-on-year, confirming the Bank of Japan’s intention to raise interest rates. In the US session, traders will focus on the PCE inflation data, which is considered the preferred inflation indicator for the US Fed. It is expected to show a slight increase, which will be positive for the US dollar. However, if the data is soft, the pressure on the USD will increase.

Main events of the day:

– Japan Tokyo Core CPI (m/m) at 01:30 (GMT+2);
– Japan Unemployment Rate (m/m) at 01:30 (GMT+2);
– Japan Retail Sales (m/m) at 01:50 (GMT+2);
– German Retail Sales (m/m) at 09:30 (GMT+2);
– Switzerland Retail Sales (m/m) at 09:30 (GMT+2);
– German Unemployment Rate (m/m) at 10:55 (GMT+2);
– German Consumer Price Index (m/m) at 15:00 (GMT+2);
– Canada GDP (m/m) at 15:30 (GMT+2);
– US Core PCE Price Index (m/m) at 15:30 (GMT+2);
– US Chicago PMI (m/m) at 16:45 (GMT+2).

by JustMarkets, 2025.01.27

Open Account