Markets will kick start 2023 with a heavily crowded economic calendar. The US and the Eurozone start with a set of key data releases including inflation, unemployment, PMI figures, and the US nonfarm payroll report. Additionally, investors will check the FOMC minutes looking for hints on when the central bank would stop its rate hike cycle and whether the committee members could consider any rate cut before the end of the year.
Last year has been very hard on investors in every asset class. The tight monetary policy from major central banks fueled the recession fears and weighed on risky assets such as technology stocks, indices, and cryptocurrencies. The NASDAQ lost nearly 30% of its value in 2022 and Bitcoin lost 70% while the US Dollar ended the year higher by 7.5%. Precious metals such as gold remained flat while the oil price rose by 8%.
Economic data highlights
Tuesday 3rd of January
Wednesday 4th of January
- EUR- Unemployment Rate (Germany-DEC)
- GBP- Manufacturing PMI Final (DEC)
- EUR- Inflation Rate (Germany -DEC)
- CAD- Global Manufacturing PMI (DEC)
- USD- S&P Global Manufacturing PMI (DEC)
Thursday 5th of January
- ISM Manufacturing PMI (DEC)
- FOMC Minutes
Friday 5th of January
- CNH- Composite PMI (DEC)
- JPY- Consumer Confidence (DEC)
- GBP- Global Services PMI Final (DEC)
- USD- ADP Employment Change (DEC)
- USD- Services PMI Final (DEC)
- Fed Bostic Speech
- Fed Bullard Speech
- EUR- Retail Sales (NOV)
- EUR- Consumer Confidence (DEC)
- EUR- Inflation Rate Flash (DEC)
- CAD- Unemployment Rate (DEC)
- USD- Non-Farm Payrolls (DEC)
- USD- Unemployment Rate (DEC)
- USD- ISM Non-Manufacturing PMI (DEC)
- Fed Bostic Speech
- Fed Cook Speech
- Fed Barkin Speech
The Eurozone inflation headline could fall below the 10% level due to lower oil prices. Markets expect the inflation rate to fall from 10.1% in November to 9.7% in December and any higher-than-expected data could be beneficial for the Euro as it means that the European central bank could maintain its tight policy for longer.
Investors’ focus will be on the nonfarm payroll by the end of the week. Markets expect that the US economy added 200 thousand jobs in December versus 263 thousand in November.
Any lower-than-expected data may affect consumer demand negatively leading to a lower inflation rate. A lower inflation rate could lead the FED to warp up its rate hike cycle quicker and as a result, the US Dollar price could retreat to sub 100.00 level.
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