Market Movers ahead
- In the US the main event next week will be January retail sales. Indicators of core sales point to a decent increase in January. The headline is expected to be somewhat softer as autos and building materials will drag down overall sales.
- In Euroland we will get the flash estimate of Q4 GDP. We expect the numbers to highlight the disparity between member states with Spain and Greece reporting negative growth while Germany and France are growing at a pace close to trend. In the UK focus will be on the BoE’s inflation report.
- In Asia the Chinese New Year holiday season is approaching which makes economic releases difficult to interpret due to seasonal distortions. CPI should show a modest increase in January only to accelerate sharply in February.
- We expect the Swedish Riksbank to keep the repo rate and the future path unchanged at its policy meeting next week. In Norway focus will be on CPI.
Global Update
- Trichet gave some support to Greece at the ECB meeting, but used somewhat cryptic wording. German orders disappointed and it seems like German growth hit a soft patch late last year.
- The US ISM index for the manufacturing sector continued its ascent while developments outside this sector look more fragile. Especially the latest indications from the labour market have caused some worries.
- China’s two manufacturing PMIs were mixed in January, but overall industrial activity still appears strong as other Asian PMIs improved significantly.
Focus
- Hiring for the decennial US Census will give a temporary boost to employment and distort monthly payroll data. We look at the real economic effect from this boost and the outlook for underlying employment growth.
