Headlines from the Middle East will remain in focus next week despite recent de-escalation, as there is a possibility that tensions may erupt again. The key events of the week, however, will be phase-one trade deal with China’s Vice Premier Liu, head of Beijing’s trade negotiation team travelling to Washington next week to sign the deal with the US.
Monday – 13 January 2020
- Production data (GBP GMT 09:30) – The UK production data is likely to continue disappointing as Industrial production for November is expected to get to zero while Manufacturing is drifting to 0.1% from 0.2% m/m last month.
Tuesday – 14 January 2020
- Trade Balance (CNY, GMT 07:00) – The trade balance in December could spike to $48B from $37.93B. The exports and imports should rise 2.5% from -1.3% last month and to 9.3% from 0.5% respectively.
- Consumer Price Index (USD, GMT 13:30) – Expectations have been set at a 0.2% December headline CPI rise with a 0.2% core price increase, following respective November readings of 0.3% and 0.2%. As expected gains would result in a headline y/y increase of 2.3%, up from 2.1% in November. Core prices should set a 2.3% pace for a third consecutive month.
Wednesday – 15 January 2020
- Consumer Price Index (GBP, GMT 09:30) – A flat reading is expected for December headline CPI at 1.5% y/y, while the Core prices should repeat a 1.7% pace for a third consecutive month. The data won’t cause a change of thinking at the BoE.
- US-China Phase One Trade Deal Signature – Event of the week (unconfirmed) – The United States and China governments are expected to sign their deal on phase-one new trade conditions. Meaningful details of the agreement are expected to come out.
Thursday – 16 January 2020
- Harmonized Index of Consumer Prices (EUR, GMT 07:00) – The German HICP inflation for December is anticipated to decline at 1.2% y/y from 1.5% y/y.
- ECB Monetary Policy Meeting Accounts (EUR, GMT 12:30) –The ECB Monetary Policy Meeting Accounts, similar to the FOMC minutes, provide information with regard to the policymakers’ rationale behind their decisions. In the last meeting, ECB kept policy on hold and re-affirmed easing bias at December policy meeting.
- Retail Sales (USD, GMT 13:30) – Retail Sales are an important determinant of consumer spending thus making it a leading indicator for overall economic growth. Consensus expectations suggest that they should have December gains of 0.2% for the retail sales headline and 0.5% for the ex-auto figure, following respective November gains of 0.2% and 0.1%.
- Philadelphia Fed Manufacturing Survey (USD, GMT 13:30) – The Philly Fed index is seen rising slightly, to 1.0 from 0.3 in December, versus a 1-year high of 21.8 in July and a 33-month low of -4.1 in February. The “soft data” measures have oscillated around lean but mostly positive levels since June, though with headline hits to some surveys from the UAW-GM strike that lingered into year-end, alongside a fresh headwind from Boeing. The trade war and Brexit headwinds have subsided since November, but the markets still face a wide array of troubles abroad.
Friday – 17 January 2020
- Industrial Production and Retail Sales (CNY, GMT 02:00) – The December industrial production is forecast at 5.0% y/y from 6.2% previously, while retail sales likely worsen to 7.6% y/y from 8.0%.
- China Gross Domestic Product (CNY, GMT 02:00) – Chinese GDP is projected to remain in moderation at a 6.0% y/y pace in Q4.
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Andria Pichidi
Market Analyst
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