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Central bankers to stage dovish view as economic data continues to vex

Here's the weekly rundown of the other key economic events.

Simon Kennedy | Bloomberg 

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get a chance to flesh out their increasingly dovish outlooks for monetary this year as continue to disappoint.

The US Federal Reserve will on Wednesday publish minutes from its recent meeting, which will likely show how much conviction there was among makers to suspend their interest rate hiking campaign. Fed officials John Williams, Richard Clarida and Randal Quarles are among those speaking on Friday.

makers over-corrected in a dovish direction in January,” said Carl Riccadonna, chief US economist at Bloomberg Economics. “However, the dovish tone of the meeting statement may not necessarily reflect a universal consensus among meeting participants. Public comments since the meeting, suggest the hawkish contingent may be regrouping.”

Over in Europe, President Mario Draghi and Chief Economist Peter Praet are among several European Central Bank policy makers delivering speeches at a time when the euro-area keeps falling short of expectations. Those commentaries and the Thursday release of the minutes of their last meeting might give clues on policy makers’ intentions March, in particular whether they plan new loans for banks.

“The minutes will bring more color on the January gathering, at which policy makers described risks to the outlook as to the downside,” said Jamie Murray, chief European economist at Bloomberg Economics. “Growth in the euro area has slowed, but the worst is probably over.”

Elsewhere, Bank of Canada Governor speaks on Thursday and Reserve Bank of Australia Governor Philip Lowe gives parliamentary testimony on Friday. Investors are looking for clues on whether Canada will harden its position around its pause on rates and what the recent dropping of a tightening bias means for Australia.

Here’s our weekly rundown of the other key

US

Talks between the US and China over trade are set to recommence in before tariffs on Chinese imports more than double when a truce ends March 1. A Commerce Department report on auto imports is also headed to President Donald Trump’s desk. As well as the Fed speeches, there are a couple of important numbers out, both on Thursday: durable goods orders and existing-home sales.

Europe, Africa and Middle East

The euro zone purchasing managers index due on Thursday and Friday’s release of the Ifo business confidence gauge for Germany will be closely watched as the regional economy’s prospects look increasingly clouded. In the U.K., wage and jobs data due on Tuesday will provide a glimpse of just how tight the labor market is at a time when the Bank of England would probably be tightening interest rates if it weren’t for Brexit. In Russia, President Vladimir Putin gives his annual state-of-the nation address on Wednesday. South Africa’s government delivers its budget on Wednesday amid fears the country could lose its investment-grade rating at Moody’s.

The Americas

Canada releases retail sales data on Friday. A proposed overhaul of Brazil’s pension system is headed for Congress as President Jair Bolsonaro, back in Brasilia after 17 days in the hospital, put his final touches to the bill. On Thursday, Argentina’s consumer confidence is likely to take another hit from additional increases in transport and utility prices, further challenging President Mauricio Macri’s re-election bid. Meanwhile, a mission from the Monetary Fund is in Ecuador for bailout negotiations with the government of President Lenin Moreno.

Asia

The trade wars rumbles on with the talks. Japan sees a release of key data including machine orders on Monday, trade on Wednesday, manufacturing PMI on Thursday and inflation on Friday. They will likely underscore the Bank of Japan’s preference for keeping stimulus in place. In Indonesia, the central bank is predicted to keep its key rate unchanged.


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First Published: Sun, February 17 2019. 16:52 IST
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