Financial Market Preview for February 16 -20

The volatility in the financial markets continues as the tensions between ECB and Greece’s new elected government progresses. This week, the Euro group and ECOFIN summits are likely to further discuss the Greek debt situation. Other publications and events to consider this week include: minutes of FOMC meeting, Japan’s  trade balance, U.S. PPI, Japan’s  GDP for Q4, U.S. retail sales, U.S. jobless claims, U.S. industrial production, GB CPI, German ZEW economic sentiment, U.S. housing starts, Philly Fed index, consumer sentiment, minutes of ECB and RBA’s policy meetings, and German flash manufacturing PMI. So let’s examine the economic calendar for the week of February 16th to 20th.  

(All times GMT):

Monday, February 16th

23:50 – Japanese GDP for Q4 – Preliminary estimate: In the third quarter of the year, the Japanese economy contracted by 0.4% and in the second quarter it also fell by 1.7%; this time, the report will present the first estimate for the fourth quarter of the year. The current estimates are that economy expanded by 0.9%, year over year;

All Day – Euro-group Meetings: These meetings are held in Brussels and include meetings among Euro-group President, Finance Ministers from euro area member states, the Commissioner for economic and monetary affairs, and the President of the European Central Bank;  this time the meeting is likely to keep revolving around the Greek debt;

Tuesday, February 17th

00:30 – Minutes of Reserve Bank of Australia’s Monetary Policy Meeting: The Reserve Bank of Australia reduced its cash rate by 0.25 pp to 2.25%; the minutes will provide some additional input regarding the last rate cut;

09:30 – GB CPI: According to the last report, the CPI slipped to an annual rate of 0.5% during December. The current projections are for that it will decline again to 0.3% for January. The changes in Great Britain’s inflation could impact BOE’s monetary policy;

10:00 – German ZEW economic sentiment: The next update will refer to the ZEW indicator of economic sentiment for Germany for January. During December, the ZEW indicator for Germany rose to 48.4 points; if Germany’s economic sentiment continues to rise, this may imply a recovery in Germany’s economic sentiment;

All Day – ECOFIN Meetings: These meetings will keep the talks about the recent changes in Greece and ECB’s monetary policy;

15:00 – SNB Chairman Jordan Speaks: Following the last SNB decision to stop pegging the Swiss Franc to the Euro, Jordan’s upcoming speech could keep moving the markets; he will give a speech at the University of Brussels;

Tentative – Japan’s rate decision and press conference: In the forthcoming Japanese monetary policy meeting, BOJ members will talk about the bank’s monetary policy and whether it’s time to make any changes to the bank’s asset purchase program;

Wednesday, February 18th

09:30 – Great Britain Average Earnings Index 3m/y: This report shows the changes in the price businesses and the government pays for labor force; in the last report, this index grew by 1.7%; current market estimates are for the index to remain flat at 1.7%;

09:30 – Great Britain Claimant Count Change: As of the recent update, the number of unemployed in GB fell again by 29.7K; the rate of unemployment inched down to 5.8%;

09:30 –MPC Asset Purchase and Rate Votes: In the last MPC meeting, the Bank kept its left rate at 0.5% and the asset purchase program at £375 billion; the major change in MPC’s policy is currently expected to occur in the next second half of 2015;

13:30 – U.S. Housing Starts: The U.S Census Bureau will release its U.S. housing starts monthly update for January 2015; in the last report, housing starts rose to 1,090K houses;

13:30 – U.S. Building Permits: In the last report, during December, building permits slightly slipped to 1,030K houses (the latest U.S building permits update);

13:30 – U.S. Producer Price Index: This report presents the inflation rate from the producers’ side; it will refer to January 2015. In the last report regarding December, this index for finished goods slipped by 0.3% compared with the preceding month’s level; the core PPI rose by 0.3%; current estimates are for the PPI to show a 0.4% drop in the past month;

14:15 –U.S Industrial Production: This report will present the shifts in the U.S industrial production during January; as of December, industrial production edged down by 0.1%;

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 February 13th;

19:00 – Minutes of FOMC Meeting: In the first meeting of the year back in January, the FOMC slightly revised the wording of the statement and further emphasized the term “patience” when it comes to the normalization of the current monetary policy. The ongoing recovery in the U.S. economy only raises the odds of the FOMC to raise the cash rate in the middle of the year; the minutes could provide additional input about the FOMC’s deliberations;

23:50 – Japanese Trade balance: Back in November 2014 the Japanese trade balance deficit narrowed to 710 billion yen (roughly $5.9 billion) deficit (seasonally adjusted figures). Japan is among the leading importers of commodities, including crude oil and gold; its trade balance could offer information vis-à-vis Japan’s developments in its demand for goods and services;

Thursday, February 19th

09:00 – ECB Monetary Policy Meeting Accounts: This report provides additional information about the deliberations of the ECB’s policy meeting and may refer to the QE program;

13:30 – U.S. Jobless Claims Weekly Report:  This weekly report will refer to the shifts in the initial jobless claims for the week ending on February 13th; in the recent report, jobless claims rose to 304K; the expectations are  for this number to reach 305K;

15:00 – Philly Fed Manufacturing Index: This monthly survey estimated the growth of the US manufacturing sectors. In the recent survey regarding January, the growth rate fell from +24.5 in December to +6.3 in January. If the index continues to decline, it may adversely impact not only U.S. dollar but also U.S equity markets and commodities (the recent Philly Fed review);

15:30 – EIA U.S. Natural Gas Storage: The EIA weekly update of the U.S. natural gas market will refer to the latest shifts in natural gas production, storage, consumption and rates as of February 13th;

Friday, February 20th

09:00 – Flash German, French and Euro Zone Manufacturing PMI: In the previous monthly update regarding January 2015, France’s PMI rose to 49.5 i.e. the manufacturing conditions are contracting at slower pace. Germany’s PMI edged down to 51 – the industry is growing slower. For this month, the estimates are for the German PMI to rise to 51.8. These estimates show the developments in the Euro Area’s manufacturing conditions; this news, in turn, may impact the Euro/USD currency pair and consequently commodities prices;

09:30 – Great Britain Retail Sales: According to last month’s update, retail sales in Great Britain rose by 0.4%;

09:30 – Great Britain Public Sector Net Borrowing: Based on the last month’s report, public net borrowing reached a surplus of $12.5 billion; this measures the gap between spending and income for public corporations, the central government and local governments;

13:30 – Canada Core Retail Sales: In the last report regarding November 2014, manufacturing sales rose by 0.7%; current estimates are for a 0.7% fall in the next report;

For further reading: