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MNI GLOBAL WEEK AHEAD - Central Banks Across DM and EM

TUESDAY - BoJ Decision

According to media reports, the BoJ's board is set to discuss the possibility of ending negative rates at its March 18-19 meeting. However, both our analysis and the Bloomberg Consensus suggest that it may be premature to consider tightening policy at this juncture. Recent data paint a picture of a fragile economy, with core inflation—adjusted for base-effect distortions—showing sluggish growth, indicating that the 2% target is not yet firmly established. While wage increases for 2024 are robust, the BoJ is likely to adopt a cautious approach, waiting to see the impact reflected in macroeconomic indicators and ensuring that inflation is on a more stable trajectory before considering its first rate hike in 17 years.

WEDNESDAY - Fed Decision

The FOMC will hold rates at the presumed peak of 5.25-5.50% at its March 19-20 meeting, while reiterating its cut-leaning forward guidance in the Statement. Incoming data provides the FOMC with both the justification and the flexibility to be patient before making the first cut. It’s unlikely the signal provided by the Dot Plot / economic projections will be much different to the last edition in December’s, while the Statement will be little changed after January’s overhaul. It would only take two participants getting slightly more hawkish on 2024 rate prospects to move the median dot from 3 cuts to 2. While a close call, we think the median will stay unchanged, leaving focus on Chair Powell's Q&A and how recent above-expected inflation data squares with his stated requirement of "a little more" evidence before having the confidence to initiate rate cuts.The FOMC is also expected to discuss plans to slow the pace of quantitative tightening later this year, though we will probably have to wait for the meeting minutes for details on the Committee’s current thinking.

WEDNESDAY / THURSDAY - UK CPI and BoE Decision

The upcoming week will see both inflation data (Wednesday) and the MPC policy decision (Thursday). In terms of inflation, a slowdown from January levels is expected – we have seen estimates of headline CPI around 3.2-3.7%Y/Y (versus 4.0% January), core CPI between 4.4-4.8%Y/Y (5.1% January) and services CPI around 5.9-6.2%Y/Y (6.5% January). For reference, the Bank of England’s forecasts made in the February MPR (before the release of last month’s print) are broadly in line with the early consensus for both headline CPI at 3.5%Y/Y and for services at CPI 6.1%Y/Y. Absent a big surprise in the inflation data, we expect little change from the MPC this week with an unchanged vote split (1-6-2 with Dhingra voting for a 25bp cut while Mann and Haskel continue to vote for a 25bp hike). Our base case also sees no change in forward guidance versus February, although there may be some expectations of a further softening in guidance from those who are still looking for a May cut). Bigger picture, the MNI Markets team sees the probability of first cut in May at around 15%, a 30% probability of a first cut in June, a 40% probability of a first cut in August and a 15% probability of the first cut being delayed further.

THURSDAY - SNB Decision

Market pricing and consensus views for the SNB’s March decision are on a knife-edge between a 25bps cut of the policy rate or a hold at 1.75%. The decision will depend on the SNB’s longer-term assessment of inflation against deflation risks, as Swiss headline CPI inflation has printed close to the middle of the SNB’s target range in recent months. A hold would likely be accompanied with a clearly dovish tilt in communication. Markets currently price 8-9bps of easing for the meeting, corresponding to about a 2/3 implied probability of a hold, while a 25bps cut to the deposit rate would likely be accompanied with cautious language on policy ahead.

Other DM Central Bank Decisions Next Week:

RBA (Tuesday): Rates expected unchanged at 4.35%

Norges Bank (Thursday): Rates expected unchanged at 4.50%

EM Central Banks

CEEMEA: The Czech National Bank are expected to cut its two-week repo rate by 50bps to 5.75% on Wednesday having accelerated the pace of its easing cycle with an identical move last month. Elsewhere, The Central Bank of Turkey will likely keep the one-week repo rate unchanged at 45% on Thursday, following through on guidance that further rate hikes are unnecessary. The Central Bank of Russia is also expected to stand pat on rates (at 16%) amid signs of rising inflation momentum. Cuts to the key rate are not foreseen until around Q3 of this year.

LATAM: Brazil’s central bank is expected to maintain the current pace of 50bp easing on Wednesday. Market pricing tilts towards Banxico cutting by 25bps to 11.00% on Thursday, although analysts remain split over this decision. Finally, Colombia’s central bank is firmly expected to ramp up the pace of easing, with 50, 75 and 100bp cut options likely to be on the table.

ASIA: Continued global uncertainty and the focus on FX stability is likely to keep Bank Indonesia on hold at 6.00% on March 20. It has said that H2 2024 is its window to begin easing policy.


DateGMT/LocalImpactFlagCountryEvent
18/03/20242350/0850*JP Machinery orders
18/03/20240200/1000***CN Fixed-Asset Investment
18/03/20240200/1000***CN Retail Sales
18/03/20240200/1000***CN Industrial Output
18/03/20240200/1000**CN Surveyed Unemployment Rate M/M
18/03/20240700/0800**NO Norway GDP
18/03/20241000/1100***EU HICP (f)
18/03/20241000/1100*EU Trade Balance
18/03/20241230/0830*CA Industrial Product and Raw Material Price Index
18/03/20241300/0900*CA CREA Existing Home Sales
18/03/20241400/1000**US NAHB Home Builder Index
18/03/20241530/1530UK DMO Quarterly Investor/GEMM Consultation Meetings
18/03/20241530/1130*US US Treasury Auction Result for 26 Week Bill
18/03/20241530/1130*US US Treasury Auction Result for 13 Week Bill
19/03/20240300/1200***JP BOJ policy announcement
19/03/20240330/1430***AU RBA Rate Decision
19/03/20240430/1330**JP Industrial production
19/03/20240830/0930EU ECB's De Guindos at IV Observatorio de las Finanzas event
19/03/20241000/1100***DE ZEW Current Conditions Index
19/03/20241000/1100***DE ZEW Current Expectations Index
19/03/20241000/1000**UK Gilt Outright Auction Result
19/03/20241230/0830***CA CPI
19/03/20241230/0830***US Housing Starts
19/03/20241255/0855**US Redbook Retail Sales Index
19/03/20241530/1130*US US Treasury Auction Result for Cash Management Bill
19/03/20241530/1130**US US Treasury Auction Result for 52 Week Bill
19/03/20241700/1300**US US Treasury Auction Result for 20 Year Bond
19/03/20242000/1600**US TICS
20/03/20240001/0001*UK XpertHR pay deals for whole economy
20/03/20240700/0700***UK Consumer inflation report
20/03/20240700/0700***UK Producer Prices
20/03/20240700/0800**DE PPI
20/03/20240845/0945EU ECB's Lagarde at ECB and its Watchers Conference
20/03/20240900/1000*IT Industrial Production
20/03/20240930/1030EU ECB's Lane in panel at ECB and its Watchers Conference
20/03/20241000/1100**EU Construction Production
20/03/20241100/0700**US MBA Weekly Applications Index
20/03/20241345/1445EU ECB's Schnabel in panel at the ECB and its Watchers Conference
20/03/20241430/1030**US DOE Weekly Crude Oil Stocks
20/03/20241500/1600**EU Consumer Confidence Indicator (p)
20/03/20241730/1330CA BOC Minutes (Summary of Deliberations)
20/03/20241800/1400***US FOMC Statement
21/03/20242145/1045***NZ GDP
21/03/20242200/0900***AU Judo Bank Flash Australia PMI
21/03/20242350/0850**JP Trade
21/03/20240030/1130***AU Labor Force Survey
21/03/20240030/0930**JP Jibun Bank Flash Japan PMI
21/03/20240700/0700***UK Public Sector Finances
21/03/20240745/0845**FR Manufacturing Sentiment
21/03/20240815/0915**FR S&P Global Services PMI (p)
21/03/20240815/0915**FR S&P Global Manufacturing PMI (p)
21/03/20240830/0930***CH SNB Interest Rate Decision
21/03/20240830/0930**DE S&P Global Services PMI (p)
21/03/20240830/0930**DE S&P Global Manufacturing PMI (p)
21/03/20240900/1000***NO Norges Bank Rate Decision
21/03/20240900/1000**EU Current Account
21/03/20240900/1000**EU S&P Global Services PMI (p)
21/03/20240900/1000**EU S&P Global Manufacturing PMI (p)
21/03/20240900/1000**EU S&P Global Composite PMI (p)
21/03/20240930/0930***UK S&P Global Manufacturing PMI flash
21/03/20240930/0930***UK S&P Global Services PMI flash
21/03/20240930/0930***UK S&P Global Composite PMI flash
21/03/20241100/0700***TR Turkey Benchmark Rate
21/03/20241200/1200***UK Bank Of England Interest Rate
21/03/20241200/1200UK BOE's Agents' summary of business conditions
21/03/20241200/1200UK BOE's MPS and minutes
21/03/20241230/0830***US Jobless Claims
21/03/20241230/0830**US WASDE Weekly Import/Export
21/03/20241230/0830*US Current Account Balance
21/03/20241230/0830**US Philadelphia Fed Manufacturing Index
21/03/20241335/0935CA BOC Deputy Gravelle speech on balance-sheet normalization.
21/03/20241345/0945***US S&P Global Manufacturing Index (flash)
21/03/20241345/0945***US S&P Global Services Index (flash)
21/03/20241400/1000***US NAR existing home sales
21/03/20241430/1030**US Natural Gas Stocks
21/03/20241700/1300**US US Treasury Auction Result for TIPS 10 Year Note
21/03/20241900/1500***MX Mexico Interest Rate
22/03/20242330/0830***JP CPI
22/03/20240001/0001**UK Gfk Monthly Consumer Confidence
22/03/20240700/0700***UK Retail Sales
22/03/20240700/0800**DE Import/Export Prices
22/03/20240730/0730UK DMO to release calendar for FQ1 (Apr-Jun) Ops
22/03/20240800/0900EU ECB's Lagarde in Euro Summit
22/03/20240900/1000***DE IFO Business Climate Index
22/03/20241100/1100**UK CBI Industrial Trends
22/03/20241230/0830**CA Retail Trade
22/03/20241300/0900US Fed Listens event
22/03/20241400/1500**BE BNB Business Sentiment
22/03/20241630/1630UK BOE to announce APF sales schedule for Q2-24
22/03/20241700/1300**US Baker Hughes Rig Count Overview - Weekly
22/03/20241700/1800EU ECB's Lane lecture on inflation and MonPol at AMSE
22/03/20242000/1600US Atlanta Fed's Raphael Bostic

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