Financial Market Outlook for January 18-22

Here is a short breakdown for the week of January 18th to 22nd of the main report and events of the week including: ECB rate decision, U.S. CPI, Philly Fed index, German ZEW economic sentiment, BOC’s rate decision, U.S. industrial production, China’s GDP for Q4, OPEC’s monthly update, Canada’s CPI, GB’s CPI, EU manufacturing PMI, and U.S. housing starts.  

(All times GMT):

Monday, January 18th

03:00 –China Fourth Quarter GDP 2015: Back in Q3, China’s economy grew by 6.9% in annual terms – close to expectations. Even though the economic data published in China isn’t too reliable, it’s also likely to be not too far from the state of the economy.  Current expectations place the growth rate at an annual rate of 6.9% for Q4 2015. Any lower figure could prompt more selloffs of Chinese equities;

05:30 – China’s Industrial Production: According to the latest monthly update, China industrial production rose to an annual rate of 6.2% — lower than market expectations; the growth rate is estimated to inch down to 6%;

Tentative – OPEC Monthly Report: This report will present the main developments in crude oil and natural gas’s supply and demand for December 2015; this report will also refer to the developments in the production of OPEC countries during last month;

Tuesday, January 19th

09:30 – GB CPI: According to the last monthly report, the CPI edged up to 0.1% in November. The current projections are for the inflation to inch up again in December to 0.1%;

10:00 – German ZEW economic sentiment: This report will pertain to the ZEW indicator of economic sentiment for Germany for December. Back in November, the ZEW indicator for Germany rose to 16.1 points; if Germany’s economic sentiment falls back again, this may imply slowdown in the growth of its economy; the current estimates are for a fall to 8.2;

10:00 – EU CPI (final): Based on the recent flash estimate, the CPI inched up by 0.2% in December;

Tentative –IEA Monthly Oil Update: This report will show a revised (as of December) forecast and analysis for the global crude oil and natural gas market for 2016;

Wednesday, January 20th

09:30 – Great Britain Average Earnings Index 3m/y: This report presents the developments in the price businesses and the government pays for labor force; in the recent report, this index slipped to 2.4%; current market estimates are for the index to decline further to 2.1%;

09:30 – Great Britain Claimant Count Change: As of the latest monthly update, the number of unemployed in GB rose by 3.9K; the rate of unemployment edged down to 5.2% and is expected to remain flat;

13:30 – Canada Manufacturing Sales: In the last report regarding November 2015, manufacturing sales dropped by 1.1%;

13:30 – U.S. Building Permits: In the last report, during November, building permits rose to 1,290 thousand houses (the recent U.S building permits update); current estimates are for a modest fall to 1,200K;

13:30 – U.S. Housing Starts: The U.S Census Bureau will publish its U.S. housing starts monthly update for December 2015; in the recent update, housing starts increased to 1,170 thousand houses;

13:30 – U.S Core Consumer Price Index: This monthly report refer to the developments in the core consumer price index for December 2015. According to the U.S Bureau of Labor statistics, back in November, the CPI didn’t rise; the core CPI edged up again by 0.2%; this time, the CPI is expected to remain flat again and core CPI to rise by 0.2%, again;

15:00 – Bank of Canada’s Monetary Policy Report: The Bank of Canada will publish its quarterly monetary policy report; if the Bank shows any changes in this press conference; it could impact the Canadian dollar;

15:00 – Bank of Canada’s Overnight Rate: Back in December Bank of Canada left its overnight rate at 0.50%. This time, however, the market expects the BOC will slash its rates by 0.25bp to 0.25%;

15:30 – U.S Crude Oil Stockpiles Weekly update: The EIA (Energy Information Administration) will release its weekly report on the U.S oil and petroleum stockpiles for the week ending on January 15th;

Thursday, January 21st

12:45 – ECB Rate Decision: Last month the ECB didn’t take enough measures to stimulate the EU economy as markets had anticipated. Back then, the ECB cut the deposit rate to -0.3% and extended the QE program until March 2017. What will be the decision this time? Currently the markets don’t expect any new policy measures, but the wording of the statements and the press conference could set the tone for what’s up ahead for the ECB – i.e. more stimulus or no new action in 2016;

13:30 – U.S. Jobless Claims Weekly Report:  This weekly report will refer to the changes in the initial jobless claims for the week ending on January 14th; in the last report, jobless claims increased to 281K; the expectations are  for this number to slightly fall to 281K;

13:30 – Philly Fed Manufacturing Index: This monthly survey estimates the growth of the US manufacturing sectors. In the previous survey, the growth rate fell again from -+1.9 in November to -5.9 in December. This time, the index is expected to slightly rise to -3.1 (the recent Philly Fed review);

15:30 – EIA U.S. Natural Gas Storage: The EIA weekly report of the U.S. natural gas market will refer to the latest changes in natural gas production, storage, consumption and rates as of January 15th;

Friday, January 22nd

09:00 – Flash German, French and Euro Zone Manufacturing PMI: In the last December report, France’s PMI rose again to 51.6 i.e. the manufacturing conditions are growing. And Germany’s PMI increased to 53 – the industry is expanding at a faster rate; currently, the market estimates Germany’s PMI will remain unchanged at 53;

09:30 – Great Britain Retail Sales: According to last month’s report, retail sales in Great Britain rose by 1.7%;

09:30 – Great Britain Public Sector Net Borrowing: Based on the last report, public net borrowing dropped to a surplus of 13.6 billion pounds; this measures the difference between spending and income for public corporations, the central government and local governments;

13:30 – Canada’s core CPI: According to the latest update, the CPI edged down by 0.3%, M-o-M;

13:30 – Canada Core Retail Sales: In the December report regarding November 2015, manufacturing sales remained unchanged;

15:00 – U.S. Existing Home Sales: This report will pertain to the U.S. existing home sales for December 2015; in the November report, the number of homes sold dropped to a seasonally adjusted annual rate of 4.76 million houses; the current expectations are for the annual rate to rise to 5.21 million houses;

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