Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!

Key Events This Week: CPI, BOE, Fed Speakers

Courtesy of ZeroHedge. View original post here.

While economic data reporting enters a brief lull in the post-payrolls week, which coupled with the trailing end in Q1 earnings season… 

… means things should slow down substantially if only for a few days, there are still market-moving catalysts this week, and none more important than this week's US CPI print, among other data including PPI, import & export prices U. Michigan sentiment and a murder of central bank speakers.

Coming off the back of a Fed meeting where the most interesting statement changes were those acknowledging the pickup in inflation, Deutsche Bank notes that it's hard to look past next week's US CPI report as being the main focus for markets. Away from the US, the Bank of England policy meeting – where analysts are torn whether Mark Carney will/won't hike rates – will also be a closely watched event, while there is plenty of Fedspeak front loaded into the week including Fed Chair Powell.

On the tail end of the week, the Iran nuclear accord deal deadline also looms for President Trump while NAFTA talks also resume.

Elsewhere:

  • In the Eurozone, a quiet week with factory orders and industrial production for Germany.
  • In the UK, beyond the BoE rates meeting, we have the inflation report, trade balance, industrial & manufacturing production and construction output.
  • In Japan, we have current account balance, money supply M2 & M3 and the BoJ meeting minutes.
  • In Canada, we have housing starts, building permits, labor market report and central bank speakers.
  • In China, we get foreign reserves, trade balance, PPI, CPI, money supply, new yuan loans and aggregate financing.
  • In Australia, we have business confidence, retail sales and investment lending.
  • In New Zealand, we have the RBNZ rates meeting, finance minister pre-budget speech and PMI Manufacturing.

Also, there are monetary policy meetings in Malaysia, Romania, Peru and The Philippines. Sovereign rating review in Egypt and Oman. CPI data will be released in China and Mexico.

A full visual summary of the week's key events:

Some more details on the week's key events, courtesy of DB's Craig Nicol, who notes that with regards to the US CPI report on Thursday, the current market consensus for the April data is a +0.3% mom headline reading – which would push the annual rate up to +2.5% yoy from +2.4% – and a +0.2% mom core print which would also push the annual rate up one-tenth to +2.2% and the highest since February last year.

Also notable, the market consensus for the monthly core reading is the 31st consecutive month that the consensus has been +0.2% which is a remarkable statistic: "You have to go back to September 2015 to find the last time it wasn't +0.2%. It's worth noting that of the 30 previous monthly estimates, only 17 have matched the consensus while just 6 out of the last 15 have done so."

The other big event next week comes on the same day with the Bank of England MPC meeting. This meeting perhaps takes on a little more focus given the big changes in market pricing for the event, with the probability of a hike falling from as high as 80% to less than 10% now following Carney's dovish comments and some soft in the UK of late. Indeed the market consensus is for no policy change next week however Deutsche Bank believes that the BoE will still hike due to concerns about tight supply and domestically generated inflation. However they note that this is a low conviction view particularly since the weak Q1 growth reading and slowdown in underlying wages. Indeed they remain of the view that tightening would be a policy mistake and a May hike will be the last one this year, with a hiking cycle only resuming when growth improves in 2019 and Brexit risks diminish.

In addition to the CPI, the US we'll also get some more inflation data with the April PPI report on Wednesday where current market expectations is for a +0.2% mom headline reading and +0.3% mom core reading. Also worth highlighting next week in the US is the April monthly budget statement on Thursday and preliminary May University of Michigan consumer sentiment print on Friday.

With the FOMC meeting now out of the way the Fedspeak diary picks up again next week and it's likely to be closely watched for clues of how the Fed views some of the recent data, given the statement changes in the FOMC statement. On Monday we have Fed Governor Quarles (neutral/voter) speaking overnight followed by Atlanta Fed President Bostic (neutral/voter) in the afternoon, and then new Richmond Fed President Barkin (unknown/voter),  Dallas Fed President Kaplan (neutral/non-voter) and Chicago Fed President Evans (dove/ non-voter) in the evening. Fed Chair Powell (neutral/voter) will then speak on Tuesday at a SNB/IMF conference on the topic of monetary policy influences on global financial conditions and international capital flows (Q&A is also expected). Then on Wednesday evening Bostic is due to speak again. Over at the ECB we're also due to hear from Chief Economist Praet on Monday and Governing Council member Liikanen on Tuesday, before ECB President Draghi speaks on Friday in Florence at the ADEMU conference.

Finally, other potentially market sensitive events next week worth flagging include the resumption of NAFTA talks in Washington on Monday, however big questions marks remain about whether or not a consensus will be formed, EU27 envoys gathering in Brussels on Tuesday for Brexit state of play talks, Japan PM Abe meeting with South Korea President Moon Jae-in and Chinese Premier Li Keqiang on Wednesday and the 12th May deadline for President Trump to decide on whether or not to stick with the Iran nuclear accord.

A breakdown of key events by day:

  • Monday: With it being a Bank Holiday in the UK, and markets subsequently closed, it's likely to be a quiet start to the week with the only data due in Europe being March factory orders in Germany and the May Sentix investor confidence reading for the Eurozone. In the US, March consumer credit is due while in Asia we'll get the latest BoJ meeting minutes along with April foreign reserves data in China. The Fedspeak diary is fairly packed on Monday with Quarles speaking overnight, followed by Bostic, Barkin, Kaplan and Evans during the day. The ECB's Praet is also scheduled to speak while NAFTA talks will resume in Washington.
  • Tuesday: The early focus on Tuesday will be in Germany with March trade data due along with the March industrial production print. In the UK the April Halifax house price index is due while in the US the NFIB small business optimism reading for April is due along with March JOLTS data. In China the April trade data stats are also due at some stage. Away from the data Fed Chair Powell is due to speak in the morning in Zurich at a SNB/IMF event while the ECB's Liikanen is due to speak in the afternoon. EU27 envoys are also due to gather in Brussels to discuss the state of play in Brexit talks.
  • Wednesday: The main focus on an otherwise quite day next Wednesday is likely to be the April PPI report in the US. March wholesale trade sales and inventories data will also be released while in Europe the only data of note is the March industrial production print in France. The Fed's Bostic is also due to speak again, later in the evening. It's worth noting that Japan PM Abe is also due to host South Korean President Moon Jae-in and Chinese Premier Li Keqiang.
  • Thursday: A busy day, highlighted by the April CPI report in the US in the afternoon. Prior to that we have the BoE meeting (which includes a Carney press conference and the latest inflation report) while in the morning in China the latest April CPI and PPI prints are due. Other data worth watching on Thursday is the March trade balance in Japan and UK, March industrial production in the UK and weekly initial jobless claims and April monthly budget statement in the US.
  • Friday: It's a quiet end to the week on Friday with the only significant data coming from the US with the April import price index and preliminary May University of Michigan consumer sentiment report. ECB President Draghi is also due to address an audience at the ADEMU conference in Florence.

* * *

Finally, a detailed look at events in just the US, courtesy of Goldman, which also lists consensus estimated:

Monday, May 7

  • 08:25 AM Atlanta Fed President Bostic (FOMC voter) speaks: Atlanta Fed President Raphael Bostic will give welcoming remarks at the Atlanta Fed’s annual Financial Markets Conference in Amelia Island, Florida.
  • 02:00 PM Senior Loan Officer Survey, 2018Q2: The Fed will release results and a memo from its quarterly Senior Loan Officer Opinion Survey on bank lending practices. The 2018Q1 release showed a modest easing in standards and terms for C&I loans in the fourth quarter of last year, while standards for CRE loans tightened somewhat. US bank loan growth accelerated slightly since the last survey but remains fairly weak.
  • 02:00 PM Richmond Fed President Barkin (FOMC voter) speaks: Richmond Fed President Thomas Barkin will participate in a town hall event at George Mason University in Fairfax, Virginia. Audience Q&A is expected. This is President Barkin’s first public appearance since being elected president of the Bank.
  • 03:00 PM Consumer credit, March (consensus $16.0bn, last $10.6bn); 03:30 PM Chicago Fed President Evans (FOMC non-voter) and Dallas Fed President Kaplan (FOMC non-voter) speak: Chicago Fed President Charles Evans and Dallas Fed President Robert Kaplan will speak on a panel on machine learning at the Atlanta Fed’s annual Financial Markets Conference in Amelia Island, Florida.

Tuesday, May 8

  • 06:00 AM NFIB small business optimism, April (consensus 105.0, last 104.7)
  • 10:00 JOLTS job openings, March (last 6,052k)

Wednesday, May 9

  • 08:30 AM PPI final demand, April (GS +0.2%, consensus +0.2%, last +0.3%); PPI ex-food and energy, April (GS +0.2%, consensus +0.2%, last +0.3%); PPI ex-food, energy, and trade, April (GS +0.2%, consensus +0.3%, last +0.4%): We estimate a 0.2% increase in headline PPI in April, reflecting firm core prices, offset by a decline in food prices and modestly higher energy prices. We expect a 0.2% increase in the core PPI and the PPI ex-food, energy, and trade services categories. In the March report, the producer price index was firmer than expected, reflecting strength in the core measure as well as in upstream prices.
  • 10:00 AM Wholesale inventories, March final (consensus +0.6%, last +0.5%)
  • 01:15 PM Atlanta Fed President Bostic (FOMC voter) speaks: Federal Reserve Bank of Atlanta President Bostic will speak at a luncheon hosted by the World Affairs Council of Jacksonville in Jacksonville, Florida.

Thursday, May 10

  • 08:30 AM CPI (mom), April (GS +0.30%, consensus +0.3%, last -0.1%); Core CPI (mom), April (GS +0.19%, consensus +0.2%, last +0.2%); CPI (yoy), April (GS +2.51%, consensus +2.5%, last +2.4%); Core CPI (yoy), April (GS +2.22%, consensus +2.2%, last +2.1%): We estimate a 0.19% increase in April core CPI (mom sa), which would boost the year-over-year rate a tenth to 2.2% on a rounded basis. Our forecast reflects a slight pullback in apparel prices. We expect increases in owner’s equivalent rent and medical services to be relatively firm.
  • 08:30 AM Initial jobless claims, week ended May 5 (GS 215k, consensus 218k, last 211k); Continuing jobless claims, week ended April 28 (consensus 1,810k, last 1,756k): We estimate initial jobless claims rebounded 4k to 215k in the week ending May 5. We note that the level of claims still looks relatively low in New York and New Jersey, possibly related to the timing of school holidays. Continuing claims—the number of persons receiving benefits through standard programs—fell sharply last week and reached a cycle low.

Friday, May 11

  • 08:30 AM Import price index, April (consensus +0.5%, last flat)
  • 08:30 AM St. Louis Fed President Bullard (FOMC non-voter) speaks: St. Louis Fed President James Bullard will give a presentation at the Springfield Business Development Corporation Meeting in Springfield, Missouri. Audience Q&A is expected.
  • 10:00 AM University of Michigan consumer sentiment, May preliminary (GS 98.5, consensus 98.3, last 98.8).: We estimate the University of Michigan consumer sentiment index edged 0.3pt lower in the preliminary estimate for May, reflecting small declines in the stock market and in high-frequency consumer confidence measures. The report’s measure of 5- to 10-year inflation expectations remained at 2.5% in April, near the middle of its 12-month range.

Source: Goldman, Deutsche, BofA


Do you know someone who would benefit from this information? We can send your friend a strictly confidential, one-time email telling them about this information. Your privacy and your friend's privacy is your business... no spam! Click here and tell a friend!





You must be logged in to make a comment.
You can sign up for a membership or get a FREE Daily News membership or log in

Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!