Sunday, 22 March 2020

The Week Ahead – Economic Data, Economic Uncertainty and COVID-19 Updates to Drive Risk Sentiment

By Bob Mason

On the Macro


It’s a quieter week ahead on the economic calendar, with 51 stats to monitor in the week ending 28th March. In the week prior, 58 stats had been in focus.

For the Dollar:


It’s a busy week ahead for the greenback, with U.S data making up the lion’s share of stats for the week.
Last week we saw the Dollar on the bounce, supporting those that believe it’s dangerous to bet against the Dollar.
This week, we’ll get a sense of how true that view stands.
Prelim private sector PMI numbers for March are due out on Tuesday. Looking at the estimates, economists have lowered the expectation bar, but could still be overly optimistic.
With the U.S already facing the wrath of the coronavirus, one would expect a marked contraction across both sectors.
On Wednesday, durable goods orders for February are due out that will also set off some early warning signals. Asian markets were already under the cosh, which should be reflected in the numbers.

On Thursday, finalized 4th quarter GDP numbers should be brushed aside, as should trade data. We would expect the weekly jobless claims figures to have a material influence, however…
Look out for any move back towards 300k levels. The last time initial jobless claims breached 300k was back in March 2015. At that time, the unemployment rate had stood at 5.4%. Economists have forecast a jump to 775K, which would be unprecedented. Once again, however, this may also be overly optimistic when considering the shutdowns across the country. The more pessimistic have forecasted claims of as much as 2m and possibly more.

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