Americas

In the US, the Federal Reserve is expected to keep the fed funds rate unchanged at 3.50–3.75% as it assesses inflation risks linked to surging oil prices and awaits confirmation of its new chair. Current Chair Powell is likely to maintain a cautious tone, signaling a pause in further rate cuts ahead of the end of his term on May 15. Next week also marks one of the busiest periods of the Q1 earnings season, led by mega-cap tech. Microsoft, Amazon, Alphabet, and Meta are set to report on Wednesday, followed by Apple on Thursday. Other notable earnings releases include Eli Lilly, Visa, Mastercard, Coca-Cola, Chevron, Exxon Mobil, Merck, Amgen, Qualcomm, GM, Verizon, and AbbVie. On the economic front, the advance estimate of Q1 GDP is expected to show growth of 2.1%, a sharp pickup from 0.5% in Q4, although analysts point to temporary support from rebounding government spending and elevated software prices. The PCE report is projected to show core prices rising 0.3% mom in March, easing from 0.4% in February. Personal income is expected to rebound, while personal spending likely increased by 0.9%. Additional releases include housing starts, building permits, Case-Shiller home prices, the ISM Manufacturing PMI, durable goods orders, advance foreign trade and wholesale inventories, and the Q1 employment cost index. Regional indicators such as the Chicago PMI and the Dallas Fed Manufacturing Index will also be closely watched. Elsewhere in the Americas, the Bank of Canada is expected to hold its policy rate at 2.25% as it evaluates the economic impact of the Iran conflict, with Canada’s monthly GDP also in focus. Brazil’s central bank will announce its latest policy decision, while the country’s unemployment rate will be monitored. In Mexico, attention will be on Q1 GDP and trade balance figures.

Fed Chairman Powell

Europe is set for a packed week, featuring major central bank decisions, key GDP releases, inflation data, and a wave of corporate earnings from banks, pharmaceutical firms, and energy companies. Both the European Central Bank and the Bank of England are widely expected to keep interest rates unchanged at their upcoming meetings. The ECB is likely to hold steady although further rate hikes remain possible in the months ahead. Recent remarks from ECB President Lagarde and board member Schnabel suggest a cautious, data-dependent approach before committing to additional tightening. Inflation in the Euro Area is expected to rise to 2.9% in April, the highest since December 2023, driven largely by energy costs, which are expected to climb into double-digit territory amid ongoing geopolitical tensions in the Middle East. Preliminary inflation readings are also due from Germany, France, Italy, and Spain. On the growth front, Q1 GDP estimates are expected to show modest expansion across the Euro Area, with overall growth at 0.2%. Germany and France are likely to post similar figures, while stronger growth in Spain (0.5%) may help offset weaker performance in Italy (0.1%). In the UK, analysts anticipate that the Bank of England will hold rates at 3.75%, with voting outcomes potentially ranging from unanimous support for no change to a more divided stance. Inflation data for March showed an uptick, largely due to higher fuel and heating costs. Governor Andrew Bailey has signaled a more cautious “wait-and-see” stance, warning that markets may be moving too quickly. Investors will also keep an eye on Germany’s GfK consumer confidence survey for further insight into regional sentiment. Earnings season will be in full swing. Key reports are expected from companies including Novartis and Linde, while the UK banking sector kicks off with results from Barclays, followed by Lloyds Banking Group and NatWest Group. In pharmaceuticals, AstraZeneca and GSK will be closely watched, alongside consumer goods giant Unilever. Elsewhere in Europe, notable earnings are expected from Airbus, Air Liquide, TotalEnergies, Schneider Electric, BNP Paribas, Banco Santander, BBVA, and Iberdrola.

Seat of the ECB, Frankfurt

In China, investors will focus on both official and private PMI surveys, which are expected to signal a slowdown in manufacturing growth. Corporate profit data will also be released. Meanwhile, the National People’s Congress Standing Committee is scheduled to meet from April 27 to 30 to deliberate on key legislative priorities. In Japan, it will be a busy week, with attention centered on the Bank of Japan’s monetary policy decision. The central bank is widely expected to keep its benchmark rate unchanged at 0.75% as policymakers assess the impact of the Middle East conflict on inflation and growth. Key economic releases include the unemployment rate, which is expected to remain steady at 2.6%. Housing starts are projected to fall sharply by 28.5% in March, while industrial production likely rebounded by 1.1% month-on-month. Retail sales are expected to grow 0.8% year-on-year. In addition, consumer confidence likely edged lower, while core inflation in Tokyo is seen ticking up to 1.8%. In Australia, markets will closely monitor both monthly and quarterly inflation data, with the headline annual rate expected to rise to 4.7% from 3.7% in March. Other key releases include export and import price indices, private sector credit, quarterly producer prices, and commodity price trends. India will also release industrial production data. Elsewhere in the region, trade figures are due from Hong Kong, the Philippines, South Korea, and Vietnam. GDP readings are expected from Saudi Arabia and Taiwan, while central banks in Pakistan and Thailand are set to announce their latest monetary policy decisions.

Beijing Skyline