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The UK, US and the Eurozone in the week ahead

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  • Federal Reserve rate decision
  • US GDP update
  • Earnings season shifts up a gear

Monday 25th July

It’s a slow start to the week in terms of economic data releases. Overnight we have Chinese Foreign Direct Investment with the German ifo Business Climate survey kicking off the European session. From the UK we have the CBI’s Industrial Order Expectations data. Monday’s big earnings announcements come from Alphabet, First Bancorp, JetBlue Airways, Newmont, Ryanair, and NXP Semiconductors.

Tuesday 26th July

The Bank of Japan releases the minutes from its last Monetary Policy Meeting. Then from the UK we have an update on the CBI’s Realised Sales. From the US we have some housing data with both the S&P/Case Shiller Composite-20 House Price Index and then New Home Sales. We also have the latest Conference Board’s Consumer Confidence data and the Richmond Manufacturing Index. The biggest earnings come from 3M, Centene Corp, Chipotle, Coca-Cola, General Electric, General Motors, Juniper Networks, Microsoft, Raytheon, Texas Instruments, UBS, and Visa.

Wednesday 27th July

Overnight we have the British Retail Consortium’s Shop Price Index, together with an update on Australia’s Consumer Price Index (CPI). From across the Euro zone, we have the M3 Money Supply, Private Loans, and the German GfK Consumer Climate survey. From Switzerland there’s Credit Suisse Economic Expectations but today’s key data comes from the US in the form of Durable Goods, Pending Home Sales, Wholesale Inventories and Weekly Crude Oil inventories. But the highlight of the week, if not the month, is the Federal Reserve’s FOMC rate decision. Back in June the Fed upped their hawkishness at the last minute, indicating just days before the meeting that they were preparing to raise rates by 75 basis points (bps) rather than the 50-bps priced in by the markets. They also indicated that they were prepared to hike by an additional 75-bps at the July meeting. But following a much hotter-than-expected CPI reading, the probability of a 100 bps move suddenly shot higher, only to be quickly dampened down by Fed members over a couple of days. Currently, markets are expecting a 75-bps move and there hasn’t been any data to counter that forecast so far. Investors will also pay close attention to the following press conference held by Fed Chair Jerome Powell. They will be hoping for clues to the Fed’s thinking ahead of the next meeting in September. The major earnings reports come from Boeing, Bristol-Myers Squibb, Cameco, Ford, GSK, Hilton, Meta Platforms, Pinterest, QUALCOMM, Shopify, Spotify, T-Mobile, Teladoc Health, and Kraft Heinz.

Thursday 28th July

Overnight we have Australian Import Prices and Retail Sales. Then there’s German CPI, and the UK’s Nationwide House Price Index. Following this there’s Spanish Unemployment, while from the US we have the first look at second quarter GDP and Weekly Jobless Claims. Key earnings reports come from Apple, Altria, Amazon, Arcelormittal, Caterpillar, Comcast, Harley Davidson, Honeywell, Intel, Mastercard, Merck, Northrop Grumman, Pfizer, Peabody Energy, Shell, Southwest Airlines, and Yum China.

Friday 29th July

Friday brings an absolute rash of second order data from just about everywhere. Overnight from Japan we have the Unemployment Rate, Bank of Japan Summary of Opinions, Preliminary Industrial Production, Retail Sales, Consumer Confidence, and Housing Starts. From Australia there’s Producer Prices and Private Sector Credit. From the Euro zone we have French Flash GDP, CPI and Consumer Spending, German Unemployment, GDP and Import Prices, Spanish CPI, Spanish Flash GDP, Italian Unemployment, and GDP, and Euro zone Flash CPI and Flash GDP. There’s also UK Money Supply and Net Lending, and Canadian GDP. But the day’s highlight is US Core PCE which is the Federal Reserve’s preferred inflation measure. Unlike Headline CPI, Core PCE has been trending downwards for a few months now indicating that core inflation may have peaked. However, investors are much more concerned with headline inflation numbers as these include highly volatile, yet extremely important components, food, and energy. Today’s PCE data could be less important than usual as it follows on from the Federal Reserve’s rate decision, particularly as there’s no FOMC meeting in August. Today’s major earnings reports include AbbVie, AstraZeneca, Colgate-Palmolive, Exxon Mobil, Procter & Gamble, Provident Financial, and Sony.

David Morrison is an Analyst with Trade Nation. Trade Nation was set up with the specific remit to help customers realise their trading goals by changing the way they engage with the financial markets. As well as providing full transparency and making sure all customers get a fair deal, Trade Nation is fully regulated. This means customers can be confident they’re getting the trading experience they deserve. Visit www.tradenation.com to find out more

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