An important week is coming up with regards to economic announcements and central banks, as PBoC, BoJ, BoC and ECB rate decision are expected to take place although none are expected to shake the market. Meanwhile, reduced liquidity will define trading on Friday as the Chinese Lunar New Year holiday begins.
Monday – 20 January 2020
- Interest Rate Decision (CNY, GMT 01:30) – The PBoC is expected to keep its interest rates at 4.15%.
Tuesday – 21 January 2020
- Interest Rate Decision and Conference (JPY, GMT 03:00) – The central bank signaled its commitment to keep interest rates at current levels “for an extended period of time, at least through around spring 2020”. The BoJ Governor said in his last statement that cutting rates further is a possible policy option, adding that he doesn’t think that Japan is near the reversal rate. He also said that he doesn’t think the BoJ needs to change the forward guidance for now. Hence this is likely to remain the scenario in this week’s Monetary Policy Statement.
- Employment and Earnings (GBP, GMT 09:30) – Earning growth excluding bonus is expected to have declined by 3.4% in November, below the 3.5% the previous month. The ILO unemployment rate (3M) for November could rise to 3.9% from 3.8%.
- ZEW Economic Sentiment (EUR, GMT 10:00) – German Economic Sentiment for January is projected at 4.3 from the 10.7 seen last month, as the current conditions indicator for Germany turned negative. The overall Eurozone reading though is expected to decline further to 5.5 from 11.2. A lower than expected outcome ties in with the stagnation in market sentiment at the start of the month.
Wednesday – 22 January 2020
- Consumer Price Index and Core (CAD, GMT 13:30) – The average of the three core CPI measures for December is expected to have come out slightly lower than last month, at 2.1% y/y from 2.2% y/y. The CPI backstops continue to back the BoC’s steady policy outlook.
- Interest Rate Decision and Conference (CAD, GMT 15:00) – No change is seen in the current 1.75% policy setting, alongside an announcement and MPR that are consistent with steady policy through year end.
Thursday – 23 January 2020
- Labour Market Data (AUD, GMT 13:30) – Australia’s recent employment report showed a slowdown in jobs growth also affected by the bushfires crisis. In December, the unemployment rate is anticipated to jump back to 5.3% while the employment change is expected to fall to 14K from 39.9K last time.
- ECB Interest Rate Decision and Conference (EUR, GMT 12:45 & 13:30) – The ECB is expected to keep policy on hold in January as policy review starts. The ECB kept policy on hold and re-affirmed easing bias at the December policy meeting.
- Consumer Price Index (NZD, GMT 21:45) – The overall New Zealand CPI for Q4 should rise to 2.2% y/y from 1.5%.
- Monetary Policy Meeting Minutes (JPY, GMT 23:50) – The BoJ Minutes report provides the BoJ Members’ opinions regarding the Japanese economic outlook and any views regarding future rate changes.
Friday – 24 January 2020
- Chinese New Year’s Eve – Asia Markets closed
- Markit PMI (EUR, GMT 09:00) – The prel. December manufacturing PMI was revised up to 46.3 from 45.9, still down from 46.9 in November. The manufacturing sector has been stuck in recession for eleven successive months. The composite PMI for January meanwhile is expected to be lifted to 51.0 along with a possible rise in services.
- Markit PMI (GBP, GMT 09:30) – The prel. UK Services PMI for January is forecasted to register a downwards reading to 49.4 after the upwards revision last week at 50.0.
- Retail Sales (CAD, GMT 13:30) – Retail Sales should register a gain in November to 0.1%, after the -1.2% plunge to 0.1% in total sales values in October.
- Manufacturing PMI (USD, GMT 15:00) – The Manufacturing PMI is expected to have decreased to 52.3 in January, compared to 52.4 in December.
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Andria Pichidi
Market Analyst
HotForex
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