Darren415
US
It will be a busy week filled with the first look at Q4 GDP, corporate earnings, and US debt ceiling gridlock. There is a lot of risk on the table and a key focal point for many will be the modest growth we will see alongside a plethora of data points that are signalling recession warnings. Traders will want to see if the contraction manufacturing and service PMI readings we saw in December show any improvement this month.
Wall Street is also fixating on what will happen with debt ceiling talks. Special measures are being used and that should stave off default until June 5th, but flare-ups will most likely happen along the way.
Earnings season shifts away from the banks and now focuses on broader parts of the economy. Key earnings include results from Tesla (TSLA), Chevron (CVX), the airlines, Lockheed Martin (LMT), Visa (V), American Express (AXP), 3M (MMM), Abbott Labs (ABT), J&J (JNJ), GE (GE), IBM (IBM), and Colgate-Palmolive (CL).
EU
The flash PMIs early in the week will be of keen interest as investors continue to assess how much trouble the economy is in. A relatively mild winter to date has boosted the bloc’s economic prospects as gas prices have fallen considerably.
This isn’t expected to be reflected in the PMIs though, with the prospect of much higher interest rates and a tougher global economic environment continuing to weigh. It will be interesting to see if there is any improvement as a result of this and China’s growth prospects.
Regardless, markets expect the ECB to hike by another 150 basis points over the coming meetings and officials have been keen to ensure investors don’t become complacent on that. I expect more commentary along those lines next week.
UK
While the PMIs would typically be the standout release next week, investors may have more of an eye on the PPI inflation data for signs of inflationary pressures subsiding. The CPI data in December declined for a second month but remains far too high, above 10%. We’ll need to see much greater signs of those pressures abating before the Bank of England can become more comfortable.
Russia
The only economic release of note is the PPI data. That aside, the focus will remain on the war in Ukraine.
South Africa
The SARB is expected to raise interest rates by another 50 basis points on Thursday, taking the repo rate to 7.5%, although they could opt for only 25. Inflation has been heading in the right direction since peaking in the summer and could be back within the 3-6% target range before long. Investors will be looking for signs on whether the tightening cycle is now at or near an end.
Turkey
The CBRT left the repo rate unchanged at 9% in January after opting to pause the easing cycle late last year. The quarterly inflation report may offer insight into whether rates will fall again and when but that aside, I’m not sure it will contain much of note given the logic adopted to justify cutting interest rates over the last couple of years.
Switzerland
Trade data is the only notable release next week.
China
This Saturday is Chinese New Year’s Eve, followed by the Spring Festival. The New Year atmosphere which generally extends until at least the end of January may further stimulate domestic consumption and investment in China.
The billions of trips made during the Chinese New Year could bring the second wave of Covid-19 to largely unaffected rural areas and smaller cities. Given that the general population will have a higher level of immunity, the economic impact of a second outbreak should be less in areas that have already withstood the main wave of evacuations.
India
No major data or central bank appearances are expected.
Australia & New Zealand
China’s full reopening since the beginning of January this year and its renewed focus on ‘economic development’ will benefit economic growth in Australia and New Zealand. The largest potential upside from reopening itself sits within the services sector given China is the largest consumer of Australian tourism and education exports.
Australia recently released its CPI for November at an annual rate of 7.3%, in line with expectations but higher than the previous value of 6.9%, indicating that Australia’s inflation level may still not have peaked.
The RBA’s CPI for December will be released on Thursday, as well as its revised CPI average quarterly rate for the fourth quarter. New Zealand’s CPI for the fourth quarter will offer clues on whether sustainable disinflation is underway.
Japan
The Bank of Japan monetary policy decision saw them defer any major decisions until at least Governor Kuroda’s last meeting in March, barring any surprises in the interim.
Following that, the summary of opinions on Wednesday could be of interest, as will the December minutes, released Monday. Despite being outdated now, it will provide perspective on the decision to unexpectedly tweak its yield curve control band.
Next week also focuses on the Japan PMI readings, leading index, and Tokyo’s CPI.
Singapore
The release of the December inflation will be followed closely. MAS sees core inflation averaging 3.5%–4.5% this year.
Economic Calendar
Saturday, Jan. 21
Economic Events
US Treasury Secretary Janet Yellen visits Senegal, Zambia, and South Africa
Sunday, Jan. 22
Economic Events
Germany Chancellor Scholz and French President Macron hold a joint news conference after a Franco-German cabinet meeting in Paris
Italian PM Meloni visits Algiers
Monday, Jan. 23
Economic Data/Events
US Conference Board leading index
Euro area consumer confidence
EU foreign ministers meeting in Brussels
Russian Foreign Minister Lavrov is expected to travel to South Africa’s Pandor
ECB’s Panetta speaks in the European Parliament
ECB President Lagarde makes a speech at the Deutsche Boerse annual reception
Bank of Japan releases minutes of its December meeting
Tuesday, Jan. 24
Economic Data/Events
US flash PMIs; Richmond Fed Manufacturing
Australia Judo Bank PMI, business confidence
Chile PPI
European flash PMIs: Eurozone, Germany, UK, and France
Japan PMIs, department store sales
Mexico international reserves, bi-weekly CPI
New Zealand performance services index
Thailand trade
South Africa leading indicator
ECB’s Knot speaks at the Future of the Financial Sector conference in Frankfurt
German Foreign Minister Baerbock addresses the Council of Europe in Strasbourg
SNB’s Vice Chairman Schlegel speaks in Zurich
Earnings from Danaher (DHR), General Electric, Intuitive Surgical (ISRG), Johnson & Johnson, Lockheed Martin, Microsoft (MSFT), Raytheon Technologies (RTX), Texas Instruments (TXN), 3M, Union Pacific (UNP), and Verizon (VZ).
Wednesday, Jan. 25
Economic Data/Events
US MBA mortgage applications, Philadelphia Fed non-manufacturing activity
Australia CPI, leading index
Canada rate decision: Expected to raise rates by 25bps to 4.50%
Germany IFO business climate
Japan leading index
Mexico economic activity IGAE
New Zealand CPI, credit card spending
Russia PPI, weekly CPI
Singapore CPI
Thailand rate decision: Expected to raise rates by 25bps to 1.50%
The Republican National Committee winter meeting is held
Nordic economic outlook published by Finland’s Nordea Bank
Germany’s Economy Ministry publishes its annual report with updated forecasts
BOJ announces the outright purchase amount of government securities
Earnings from Abbott Laboratories, ASML Holding (OTCPK:ASMLF), AT&T (T), Boeing (BA), IBM, and Tesla.
Thursday, Jan. 26
Economic Data/Events
US Q4 GDP, new home sales, initial jobless claims, goods trade balance, US durable goods, wholesale inventories, retail inventories
Canada CFIB business barometer
Japan PPI services, machine tool orders
Mexico unemployment rate
Russia gold, forex reserves
Singapore industrial production
South Africa rate decision: Expected to raise rates by 50bps to 7.50%
New Zealand releases financial statements for the five months to Nov. 30
BOJ releases summary of opinions from January meeting
Earnings from American Airlines (AAL), Blackstone (BX), Comcast (CMCSA), Intel (INTC), LVMH Moet Hennessy Louis Vuitton (OTCPK:LVMHF), Mastercard (MA), SAP (SAP), Southwest Airlines (LUV), and Visa.
Friday, Jan. 27
Economic Data/Events
US personal income/spending, University of Michigan consumer sentiment, pending home sales
Australia PPI, export/import price index
Japan Tokyo CPI
Mexico trade balance
New Zealand business confidence
Singapore home prices
South Korea business survey
Thailand foreign reserves, forward contracts
Spain GDP
Earnings from American Express, Chevron, and HCA Healthcare (HCA).
Sovereign Rating Updates
Denmark (Fitch)
Greece (Fitch)
Hungary (S&P)
Netherlands (Moody’s)
Portugal (DBRS)
Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.
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