5 Key Developments to Watch Next Week
Here are 5 key developments to watch next week. Inflation and business activity from the UK and the US will be announced, while PMI data is released from the Eurozone. On the other hand, the Black Friday holiday period begins amid concerns that consumers may tighten their belts.
- FED Minutes
On Wednesday, the Fed will release the minutes of its November meeting. Politicians had decided that the US economy was strong enough to begin reducing the asset purchase program that went into effect during the pandemic.
The Fed will share its new quarterly forecasts after its meeting in mid-December, which may offer a better reading for the shift in policymakers' views.
- Biden's FED Election
Last week, the White House said that President Joe Biden could announce before the Thanksgiving holiday he will decide who should head the
Fed. He will either choose Fed Chairman Jerome Powell or vote for Fed Administrator Lael Brainard.
Analysts expect market volatility due to the announcement, especially if Brainard is chosen.
- US Data Schedule
On Wednesday, the US will release a series of economic data before markets close for Thanksgiving. The focus will be on personal income and expenditure figures, including the core personal consumption expenditures price index.
The economic calendar also includes revised GDP reading for the third quarter, initial jobless claims, durable goods orders, new home sales and consumer sentiment. Existing home sales and the November PMI report will also be published on Monday and Tuesday. Expectations for the PMI were that it would show only a minor improvement.
- PMIs
US November PMI data is expected to show a slight increase in business activity, while similar surveys from the Eurozone and the UK may indicate slowing activity in the manufacturing and services sectors.
The European Central Bank is increasingly under pressure to tighten its ultra-expansive monetary policy to offset the blow to household purchasing power, but President Christine Lagarde has now shattered those expectations, arguing that tightening policy could hurt the economic recovery.
On the other hand, the Bank of England seems to be the first major central bank to raise interest rates post-pandemic. Investors and economists expect a rate hike at the December 16 meeting.
- Black Friday
The shopping season kicks off on Friday amid rising inflation and supply shortages.
While there were some concerns that high inflation could hurt consumer spending, the increase in retail sales in October showed that Americans started shopping early to avoid shortages in supply. Strong retail earnings in the third quarter were also a positive sign for the shopping season.
Source:
Investing.com
