Economic Data: Will US, China CPI, and ECB Policy Steal the Spotlight?

Economic Data: US, China CPI, ECB Policy in Spotlight?

The Economic Data for this week looks quite interesting. With the first 2 day of the week have next to know important data, the rest of the week might give the market a wild ride.

US. inflation data will be critical next week. Last week, the firm jobs report predicted that the Federal Reserve may delay cutting interest rates longer. In addition, the European Central Bank should react and geopolitical risks seem to continue to support oil prices.

The key data and events for this week

Wednesday – US CPI

On Wednesday, the US will release consumer price inflation data for March, which will attract the attention of the market. Economists expect that economic data like the core inflation, which strips out food and fuel costs, to slow to 0.3 percent from 0.4 percent a year earlier.

The CPI is expected to be a modest 3.4 percent higher than a year earlier. 3.2%

The combination of strong employment data and sluggish inflation in recent months has fueled calls from top Fed officials, including Chairman Jerome Powell, for “patience” as they approach a decision to cut interest rates.

Fed releases minutes of March meeting on the same day, where officials still expected three increases this year in the number of cuts, although with less conviction compared to his prediction at the end of last year.

Further, the market is closely watch Canada policy meet. Market is forecasting to have rate unchanged at 5%. That could have a neutral impact on the dollar.

Thursday – ECB Policy, China CPI

China’s CPI and PPI for the year will be closely watched on Thursday morning. Because both numbers have a strong impact on base metal prices.

CPI is expected to decrease slightly to 0.4% from 0.7% previously, while PPI -2.8% y/y from -2.7% previously

Additionally, the ECB meets on Thursday and is expected to keep its benchmark interest rate steady at 4.50 percent before starting a rate hike cycle in June.

The market is expected to drop 25 basis points in June, so comments from President Christine Lagarde will be closely watched.

US product price data will be released on the same day. The forecast is expected to decrease modestly to 0.2% from 0.3% previously, while PPI m/m is expected to show a modest 0.3% from 0.6% previously. Both numbers have a negative impact on the dollar.

Weekly jobless claims will also recover and are expected to increase by 217,000 from 221,000 previously.

Friday – UK GDP, US Consumer sentiment

UK monthly Gross Domestic Product (GDP) report for February and the US preliminary Michigan Consumer Sentiment and Inflation Expectations economic data will provide fresh trading impetus for the market.

The UK GDP m/m is foreseen at 0.1% from previous 0.2%, which could be concern for the pound.  While, Prelim UoM Consumer Sentiment is expected to have slightly change by 79 from previous readings of 79.4. That could have a neutral impact on the dollar.

Happy Trading!

Commodity Samachar
Learn and Trade with Ease

Also Read: Gold price rises again- Will it go higher above expectations?, RBI MPC Meeting 2024: What On the RBI’s Radar?

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