The Week Ahead – Economic Data, the BoE, and COVID-19 in Focus

On the Macro

It’s a busy week ahead on the economic calendar, with 66 stats in focus in the week ending 5^th February. In the week prior, 57 stats had been in focus.

For the Dollar:

It’s another busy week ahead.

Private sector PMI and labor market figures are the key stats due out in the week.

On Monday, the ISM Manufacturing PMI for January will be in focus ahead. There would have to be a marked decline, however for the PMI to weigh on risk sentiment.

The focus will then shift to the market’s preferred ISM Non-manufacturing PMI and ADP nonfarm employment figures due out on Wednesday.

While we will expect the ADP numbers to influence, the non-manufacturing PMI will likely be the key driver.

On Thursday, the weekly jobless claims figures will be in focus ahead of nonfarm payroll and unemployment numbers on Friday.

Other stats in the week include finalized Markit PMI figures, along with factory orders and trade data. These stats will likely have a muted impact on market risk sentiment, however.

The Dollar Spot Index ended the week up by 0.38% to 90.584.

For the EUR:

It’s yet another busy week ahead on the economic data front.

In the 1^st half of the week, private sector PMI figures for Italy and Spain are due out on Monday and Wednesday.

Finalized numbers for France, Germany, and the Eurozone will also influence along with German retail sales figures on Monday.

1^st estimate GDP numbers for the Eurozone will also draw plenty of attention on Tuesday.

The focus will then shift to the ECB Economic Bulletin on Thursday German factory orders on Friday.

Other stats include finalized January inflation figures and unemployment and retail sales figures for the Eurozone. Barring particularly dire numbers, however, these should have limited impact on the EUR.

The EUR ended the week down by 0.29% to $1.2136.

For the Pound:

It’s a relatively quiet week ahead on the economic calendar. Key stats include finalized private sector PMI figures for January and January’s construction PMI.

On Thursday, however, the main event will be the BoE’s first monetary policy decision of the year.

Following particularly disappointing prelim January PMI figures, will the BoE get the markets ready for more easing?

The markets are expecting the BoE to stand pat this week.

The Pound ended the week up by 0.16% to $1.3708.

For the Loonie:

It’s a relatively quiet week ahead on the economic calendar.

Employment, trade, and Ivey PMI figures are due out. The markets will need to wait until Friday for the numbers, however.

Expect the employment and trade figures to have the greatest impact at the end of the week.

From elsewhere, private sector PMI numbers from China and the U.S will also influence in the week along with the weekly crude oil inventory numbers. Expect OPEC’s meeting in the week to also provide direction.

The Loonie ended the week down by 0.35% to C$1.2777 against the U.S Dollar.

Out of Asia

For the Aussie Dollar:

It’s another busy week on the economic data front.

January manufacturing sector stats get the week going on Monday ahead of trade and retail sales figures on Thursday and Friday.

While we can expect the stats to influence, the RBA monetary policy decision will also draw attention on Tuesday.

With no moves anticipated, the rate statement will be the key driver.

Building approvals due out on Wednesday should have a muted impact, however.

From elsewhere, private sector PMI figures from China will also provide direction in the week.

The Aussie Dollar ended the week down by 0.92% to $0.7644.

For the Kiwi Dollar:

It’s another quiet week ahead on the economic calendar.

Economic data is limited to 4^th quarter employment figures, due out on Wednesday.

With little else for the markets to consider, expect the numbers to influence.

Building consent numbers due out on Thursday should have a muted impact on the Kiwi.

From elsewhere, China’s private sector PMI figures will also provide the Kiwi with direction.

The Kiwi Dollar ended the week up by 0.06% to $0.7193.

For the Japanese Yen:

It is a relatively quiet week ahead.

Finalized private sector PMIs for January are due out ahead of household spending figures on Friday.

Expect the household spending figures to garner the greatest attention in the week.

Ultimately, however, COVID-19 news updates will continue to be the key driver.

The Japanese Yen ended the week down by 0.87% to ¥104.68 against the U.S Dollar.

Out of China

It’s busier week ahead.

The market’s preferred Caixin manufacturing PMI on Monday will set the tone.

On Wednesday, the services PMI will also draw interest as the markets look for a pickup in private sector activity.

Before the start of the week, the NBS private sector PMIs were out on Sunday morning.

The NBS Manufacturing PMI fell from 51.9 to 51.3 in January, with the non-manufacturing PMI falling from 55.7 to 52.4.

Away from the economic calendar, expect COVID-19 news from China to also influence.

The Chinese Yuan ended the week up by 0.83% to CNY6.4283 against the U.S Dollar.

Geo-Politics

U.S Politics

Stimulus talk and foreign policy moves by U.S President Joe Biden will be key in the week.

Following 4^th quarter GDP figures from last week, vaccination and infection rates will be a key area of focus.

The U.S administration has pledged 100 million vaccinations in 100 days. A marked pickup in vaccination rates would support riskier assets.

COVID-19

Vaccination rates and availability of vaccines will be key areas of interest.

An upward trend in vaccination rates and a downward trend on infection rates would support riskier assets in the week.

Expect plenty of focus on the U.S and the EU in particular, which continues to face supply issues.

Corporate Earnings

A number of big names deliver results in the week ahead.

From the U.S, key names include but are not limited to:

Alphabet Inc. (Tue), Amazon.com Inc. (Tue), Exxon Mobil Corp. (Tue), Pfizer Inc. (Tue), Ford Motor Co. (Thur).