January 30, 2023
The US jobs data and rate statements from the Bank of England (BoE) and the European Central Bank (ECB) are currently the focus of attention for many market participants. These announcements have the potential to significantly impact global financial markets, as they provide insights into the health of the respective economies and monetary policy decisions.
With traders, investors, and economists eagerly awaiting these updates, the release of these data points is sure to cause market volatility.
Here are the key events for the week ahead:
Canada Gross Domestic Product m/m (31 January)
Canada’s economy grew 0.1% in October 2022, surpassing the earlier estimate of no growth. This marks a slowdown from the previous month’s 0.2% growth.
Experts predict no change in Canada’s economy in December 2022, forecasting 0% growth from November.
US ADP Non-Farm Employment Change (1 February)
The US private sector added 235,000 jobs in December 2022, surpassing November’s figure of 182,000. However, January is predicted to see a decline with only an additional 131,000 new jobs.
US ISM Manufacturing PMI (1 February)
The US ISM Manufacturing PMI declined to 48.4 in December 2022, marking the second consecutive month of contraction. This shift in spending from goods to services caused the decline.
For January, analysts predict a PMI of 48.
FOMC Meeting and Rate Decision (1 February)
During the final Federal Open Market Committee (FOMC) meeting in December 2022, the US Fed increased the fed funds rate by 50bps to 4.25%-4.5%. Analysts predict a similar increase of 50bps this month.
BoE Monetary Policy Report (2 February)
At its December 2022 meeting, the BoE raised interest rates by 50bps to 3.5% with a 6-3 vote. This decision was made to control inflation and counteract concerns of an impending recession. Analysts anticipate the BoE will make another 50bps increase in this meeting.
ECB Monetary Policy Statement (2 February)
The ECB plans to raise interest rates by 50bps in February and March, with additional increases to follow. Analysts predict another 50bps increase this month.
US Non-Farm Employment Change (3 February)
In December 2022, the US economy experienced job growth of 223,000, the lowest since December 2020. The unemployment rate decreased to 3.5%.
For January, analysts anticipate job growth of 175,000 and a slightly higher unemployment rate of 3.6%.
US ISM Services PMI (3 February)
In December 2022, the US ISM Services PMI dropped from 56.5 in November to 49.6. Analysts expect the PMI to remain in the 49-50 range this month.
