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  • Writer's pictureDragostin Kozhuharov

Week Ahead: UK and German GDP are the highlights

After a busy week with US non farm payrolls for April coming at -20.5million last Friday, this week we come in with a smoother start and an uneventful Monday in terms of potential market moving data. So far it has been a mixed session for equities with benchmarks being higher overnight, then moving lower and now reversing these losses as the US session started. The one to potentially watch for traders in the coming weeks is - how the easing of restrictions is going to affect the number of cases/deaths related to Covid 19. Should this easing prove unsuccessful and we start seeing a second wave of increase, markets are likely to experience some pain.


Only one major economic data release for this day, comes from the US. Inflation measure in the form of US Core CPI for April. The forecast is for -0.2% and this could prove a concern for the Fed going forward, as deflationary pressure hit the economy.


Overnight we will hear from the Royal Bank of New Zealand, as they gather to make a decision on interest rates. As one of the countries which has managed to cope well with the Covid 19 crisis, the markets aren't expecting a move in interest rates. The language of the statement and the press conference could prove more interesting.

Then we get to see the preliminary first quarter GDP (YoY) for the United Kingdom. The forecast is for a contraction of 2.1%. This will be followed by another important gauge for the UK economy in the form of Manufacturing Production for March. Both of these figures are expected to be grim, we would just see whether it's worse than expected or not.

To finish the day we have US PPI for April which would come a day after the CPI release. Again expectations for a negative figure.

For all of you oil traders, don't forget for the EIA Crude Oil Inventories. With a rebound in oil prices recently, we will wait to see whether gasoline inventories continue to show an increase in demand.


On Thursday we get to see the Employment change for April in Australia. The expectation is for -575k. That being said Australia, similarly to New Zealand has been one of the countries which coped well with Covid 19, so potential surprise, in a lower job loss could be on the cards.

The weekly Initial Jobless Claims from the US finish the day. The expectation is for another 2.5million. With unemployment in the US already at 14.7% in April, these weekly numbers will give traders the opportunity to keep a track on employment until the next non-farm payroll and unemployment release.


Last day of the week and we start with Industrial Production for China (YoY) (Apr). The expectation is for an increase of 1.5%. This comes as China has restarted it's economy, however the question is whether there will be demand from buyers elsewhere.

The European session offers us the much anticipated preliminary German GDP (QoQ) (Q1). The expectation is for a contraction of 2.2%. Whether the strongest European economy will cope with this crisis as well, as it did with the 2009 one, remains to be seen.

Finally we have April retail sales data coming from the US. The expectation is for a contraction of 12% which is higher than the previous month's 8.4%, potentially signalling more trouble for retailers in the States.

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