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Euro area surveys to illustrate hit to confidence after Ukraine invasion

21 March 2022

Emily Nicol
  • German PPI data confirmed the headline rate at a new series high.
  • The flash euro area PMIs will provide an update on business conditions in March and shed some light on the initial impact of the Ukraine war on sentiment.
  • UK inflation set to rise significantly higher in February; UK retail sales are also likely to have risen further that month even as consumer confidence fell further.
  • Plenty of FOMC members in action this week.

 

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Fed raises target range for the FFR

17 March 2022

Chris Scicluna
, 
Emily Nicol
  • Despite marked deterioration in the near-term UK inflation outlook and support among several members last month for a larger hike, on balance the BoE’s MPC likely to raise Bank Rate by 25bps.
  • Data-wise, Japanese machine orders fall back in January, but still point to modest capex growth for now; euro area car sales remain in reverse as supply constraints persist.

 

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Japan's trade deficit widest level since Covid shock

16 March 2022

Chris Scicluna
, 
Emily Nicol
  • Today's FOMC announcements seem bound to bring the first Fed rate hike since 2018, with the target range highly likely to be increased by 25bps to 0.25-0.50%.
  • Japanese manufacturers were a touch more upbeat about current conditions as supply constraints faced by autos firms eased slightly, but services were net pessimists.

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UK labour market tightened further

15 March 2022

Chris Scicluna
, 
Emily Nicol
  • China’s industrial production, fixed investment and retail sales figures pointed to a much firmer first two months of the year for economic activity; so, the PBoC left its medium-term lending facility rate unchanged today at 2.85%.
  • In the euro area, today’s German ZEW investor survey seems bound to record a marked deterioration in sentiment since the Russian invasion as concerns about prices of energy, commodities and supply-chain disruption mounted.

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Monetary policy decisions dominate the week ahead

14 March 2022

Chris Scicluna
, 
Emily Nicol
  • Beyond events in Ukraine and Russia, the week will be dominated by monetary policy decisions with the Fed on Wednesday set to raise interest rates for the first time this cycle.
  • Thursday will likely see the BoE raise Bank Rate for the third consecutive meeting, but PBoC policy easing possible (tomorrow).
  • With Japanese GDP set to contract again this quarter and underlying inflation far softer, BoJ expected to leave its ultra-accommodative policy parameters unchanged (Friday).

 

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