It will be a busy week in the United States as the earnings season kick-off and several economic releases will provide an important update on the American economic recovery and inflationary pressures. Traders will also follow speeches from several Fed officials for any further details on the central bank plans for the next FOMC meeting. On the earnings front, JPMorgan Chase and BlackRock are due to report on Wednesday and Citigroup, Wells Fargo, Morgan Stanley and Goldman Sachs on Thursday. Meanwhile, CPI data on Tuesday is expected to show the inflation rate hit 8.5% in March, the highest since December of 1981, as high energy prices, supply constraints and robust demand continue to weigh. Other important releases include producer prices, retail sales, industrial production, preliminary reading for the Michigan consumer sentiment, the NFIB business optimism index, monthly budget statement, export and import prices, business inventories, and the NY Empire State Manufacturing Index. Markets will be closed Friday in observance of Good Friday.
Elsewhere in America, the Bank of Canada is expected to raise rates for a second straight meeting but by a half-percentage point this time. It will also be interesting to follow: Mexico industrial production, Brazil retail sales and business confidence and Argentina inflation rate.
In Europe, the European Central Bank will deliver its latest monetary policy decision, but no changes are expected as officials wait for further developments in the war in Ukraine despite the current record high level of inflation. Still, investors will look for some clarity on when, and how fast the rate hike cycle will develop after the ECB’s March meeting minutes came in more hawkish than anticipated. Policymakers surprised markets by signaling plans to end its asset purchase programme in Q3 and a large number wanted an immediate normalization of policy.
Turkey will also be deciding on interest rates. At the same time, updated reports on inflation will be released for Germany, France, Italy, Spain and several other countries. Other data to follow include: Germany ZEW economic sentiment and wholesale prices; France balance of trade; Italy industrial production and Turkey unemployment rate and industrial activity. European markets will aslo react to the first round of French presidental elections on Sunday with Incumbent President Macron likely taking a slight lead over a right wing candidate Marie Le Pen.
The United Kingdom’s economic calendar is packed with key updates on monthly GDP figures, alongside industrial production and trade balance on Monday, followed by the jobs report on Tuesday and the March CPI report on Wednesday. Prices paid by UK consumers likely surged in March by 6.7%, the most since March 1992.
Australia will have a busy week, with releases of business and consumer confidence surveys, and labor market figures, with the jobless rate expected to decline to an all-time low of 3.9%. In New Zealand, the RBNZ is set to raise interest rates to a pre-pandemic level of 1.25%. Also, South Korea’s central bank meets on April 14th, a day after the country’s labor market data is released.
The spotlight will also be on China, whose inflation rate, credit, and external trade figures for March are expected, with the latter forecasted to show sustained growth in exports and a moderation in imports.