The key economic releases this week are CPI, retail sales, and industrial production on Wednesday. In addition, there are several scheduled speaking engagements from Fed officials this week, including Chair Yellen’s semi-annual Monetary Policy Report to Congress on Tuesday and Wednesday (Humphrey-Hawkins).
As discussed yesterday, the biggest event this week takes place on Tuesday when Fed-Chair Yellen is due to deliver her semi-annual congressional testimony before the Senate. She will then speak before the House Financial Services Committee on Wednesday. Even though we’re unlikely to hear much new from Yellen, many banks believe she will use it as an opportunity to emphasize that the economy is reaching Congress’ legislated mandates of full employment and price stability. Some banks, most notably BofA, expect her to boost March rate hike odds closer to 50% to make the meeting “live.” Yellen will also likely address Fed balance sheet strategy in broad terms as it does not appear that the FOMC has formed a consensus around the details.
Wednesday’s CPI report will also be closely watched for hints on ongoing inflation trends and may spark further gains in the dollar.
It’s a very quiet start to the week today with nothing of particular note due out aside from CPI revisions in the US.
On Tuesday we kick off in China with the January CPI and PPI prints before we then get industrial production data in Japan. During the European session we’ll get Q4 GDP data in Germany as well as the final CPI revisions for January and the February ZEW report. In the UK the January CPI/PPI/RPI data is out, while the other data due out is Euro area Q4 GDP and industrial production. Over in the US we’ll get the NFIB small business optimism survey as well as January PPI.
It looks set to be a busy day on Wednesday too. In Europe we’ll get the December and January labour market data in the UK, as well as the December trade balance for the Euro area. Over in the US the highlights are the January CPI report and January retail sales data. Empire manufacturing, business inventories, industrial and manufacturing production, and the NAHB housing market index reading will also be released.
