Market Clash With Rate Uncertainty: Can Data Bring Clarity?

Thursday, 25th April 2024, 14:30 – US GDP (QoQ) (Q1)

In March, the government revised its previous estimate, indicating that the U.S. economy expanded at a robust annualized rate of 3.4% from October to December. Initially, it reported a slightly lower growth figure of 3.2% for the same period. This growth represented the sixth consecutive quarter of the economy growing at an annual rate exceeding 2%. The recent update primarily reflected increases in consumer spending and nonresidential fixed investment, albeit partially offset by a decline in private inventory investment, as stated in the U.S. Bureau of Economic Analysis’ report. With no signs of deceleration in the U.S. economy, analysts and markets anticipate further inflation and sustained growth in the foreseeable future.

Thursday, 25th April 2024, 14:30 – US Initial Jobless Claims

The number of individuals in the United States who filed for unemployment insurance benefits were unchanged at a seasonally adjusted 212,000 for the week ended April 13. Despite the Federal Reserve’s attempts to cool it, the U.S. labor market persists in flourishing, while inflation in the U.S. remains high. However, there’s been a recent surge in announcements of job cuts by companies, particularly within the technology and media sectors. Major players such as Alphabet (Google’s parent company), Apple, eBay, TikTok, Snap, Amazon, Cisco Systems, and the Los Angeles Times have all made recent announcements regarding layoffs. Consequently, it’s anticipated that the forthcoming data release may show a slowdown and retreat in the job market.

Friday, 26th April 2024, 05:00 – BoJ Interest Rate Decision

In March, the Japan’s central bank increased its benchmark interest rate for the first time in 17 years, marking the end of a prolonged period of negative rates aimed at stimulating the economy. Sources indicate that the Bank of Japan is transitioning towards a more discretionary approach in setting policy, with reduced focus on inflation. This adjustment comes as the central bank charts its monetary course following the historic decision to conclude a radical stimulus program in March. With monetary settings seen on hold, it’s likely that the upcoming decision will bring no unexpected surprises.

Friday, 26th April 2024, 14:30 – U.S Core PCE Price Index (YoY) (Mar)

In February, prices in the United States saw a slowdown, particularly in the cost of services excluding housing and energy, which moderated significantly. The Federal Reserve’s preferred indicator, the personal consumption expenditures (PCE) price index, rose by 0.3% for February, a decrease from the previous figure of 0.5%. This scenario maintains the possibility of a June interest rate cut by the Federal Reserve. Analysts suggest that core services inflation is slowing down and is expected to persist throughout the year. Consequently, the market may anticipate the forthcoming indicators to demonstrate ongoing signs of cooling.