Weekly Analysis ( 16 Jan – 20 Jan 2023 )

16 Jan – 20 Jan 2023

Monday

Holiday

USD

Martin Luther King Jr. Day

10:00

EUR

German ZEW Economic Sentiment

15:00

GBP

UK BoE Gov Bailey Speaks

Teusday

02:00

CNY

China GDP

07:00

EUR

German CPI

Wednesday

03:00

JPY

BoJ Outlook Report

07:00

GBP

UK CPI

10:00

EUR

EU CPI

13:30

USD

US PPI

13:30

USD

US Retail Sales

Thursday

10:30

EUR

ECB Lagarde Speaks

13:30

USD

US Initial Jobless Claims

13:30

USD

Philadelphia Fed Manufacturing Index

16:00

USD

Crude Oil Inventories

Friday

07:00

GBP

UK Retail Sales

10:00

EUR

ECB Lagarde Speaks

15:00

USD

US Existing Home Sales

Last week, the US CPI data was in line with expectations, which caused the DXY to not fluctuate much and had a positive impact on precious metals, stock indices, and major currency pairs.
This week, it should be noted that the U.S. stock market will be closed on Monday in observance of Martin Luther King Jr. Day holiday. The main focus will be on U.S. earnings and retail sales numbers due to the holiday season. Additionally, the Bank of Japan's recent meeting will be closely watched after they surprised markets with a change in policy in December. Expectations are that economic data from China will be negative and the World Economic Forum will be holding its winter meeting in Davos.

Moreover, the U.S. will be releasing retail sales figures for December, which are expected to show a decline of 0.8% after a 0.6% drop in November. Additionally, data on producer price inflation, existing home sales, and initial jobless claims will be released, as well as regional reports on manufacturing output. There is hope that the recent data showing a decline in U.S. consumer prices in December, the first time in over two-and-a-half years, could mean inflation is on a sustained downward trend and the Federal Reserve may be able to ease back on interest rate increases.

China will be releasing its fourth quarter and full-year GDP data on Tuesday, along with December figures on retail sales, investment, and industrial output. These data releases are expected to be poor. Despite this, investors are starting to focus on the potential for recovery in China's economy as it rapidly reopens. However, there is concern that a significant increase in travel ahead of the Lunar New Year holidays, starting on January 21, could lead to a spike in COVID-19 cases. Chinese authorities reported on Saturday that nearly 60,000 people have died from COVID-19 in hospitals since the country abandoned its zero-COVID policy last month following widespread protests.

This week, the World Economic Forum (WEF) will be holding in Davos, Switzerland since before the pandemic. The meeting will bring together world leaders, central bank policymakers, and top corporate leaders. Among the expected attendees are European Central Bank President Christine Lagarde, German Chancellor Olaf Scholz, NATO General Secretary Jens Stoltenberg, and Chinese Vice-Premier Liu He. The WEF's annual meeting in Davos is known for being a high-profile gathering where business leaders, politicians, and international organizations discuss pressing global issues and shape the economic and political agenda for the year ahead.