Look ahead: UK and German consumer confidence; BOJ minutes; Core PCE; American Express
Watch out for FX volatility on Friday when we get the latest UK and German consumer confidence print. The latest minutes from the last Bank of Japan meeting may prompt Yen moves.
Plus, Core PCE in focus after Thursday’s solid set of US data readings. On the retail front, keep an eye out for American Express and WH Smith.
(AI Video Summary)
UK GfK Consumer Confidence
In today's "Look ahead" video, Angeline Ong talks about the important economic data and company earnings reports that will have an impact on the markets on Friday 26 January. She starts by discussing the GfK Consumer Confidence data out of the UK, which is expected to be negative 21 for January. Ong also notices that the GBP/USD currency pair is trending upwards, but there are signs of consolidation and difficulty in breaking above 12,830 on a daily chart. She explains that this could be due to concerns about inflation and the expectation that the Bank of England will maintain interest rates in February.
BOJ releases meeting minutes
Moving on to Japan, Ong mentions the release of Bank of Japan Minutes, which can give us insight into the country's monetary policy decisions. In Germany, the GfK Consumer Confidence data expected to impact the foreign exchange markets, especially for the euro. The forecast for February is -24.5.
US economic data analysis
Now focusing on the US, Ong talks about the release of the core PCE, personal income and spending data, and pending home sales. She mentions that recent strong US data suggests a healthy economy, which could influence the Federal Reserve's decision on whether to lower interest rates in March. However, the market's expectation for a rate cut has decreased lately. Additionally, the Baker Hughes oil rig count will be released.
Company trading statments and earnings reports
Ong then turns her attention to the trading statements from companies. She highlights the anticipation for WH Smith's Christmas trading figures, particularly in essential items like food and travel-related items. The general merchandise sector in the UK is expected to be weak. In the US, American Express' earnings report will be released. Ong sees this as a good indicator of consumption in various sectors and the overall economy. She mentions the cost-of-living crisis in the US and acknowledges signs of consumer strain, but also notes that the labor market remains strong and overall economic data looks positive. American Express' numbers can give us insights into consumer sentiment.
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