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MNI GLOBAL WEEK AHEAD - Eurozone Flash Inflation, US PCE Highlight

TUESDAY - Japan CPI

Next week's CPI is expected to show a further downstep in y/y headline and core inflation momentum. The consensus looks for a 1.9% y/y headline outcome (prior 2.6%), while ex fresh food is expected to print the same (prior 2.3%). The metric which excludes fresh food and energy is projected at 3.3% (from 3.7% prior). Still, for the headline January 2023 was the peak in terms of y/y momentum, hence base effects are a factor. The BoJ is more focused on the current round of wage negotiations to help achieve sustainable inflation closer to its target. Hence we may not see a huge reaction to the upcoming CPI print.

TUESDAY - NBH Decision

Given the risks which warranted caution at the last MPC meeting in January have largely subsided, softer-than-expected inflation and GDP data is likely to facilitate a step-up in the easing pace to 100bps at this juncture. Nevertheless, the threat to FX stability of a more dovish policy mix poses downside risks given 75bp cuts have been delivered in the previous four meetings.

WEDNESDAY - RBNZ Decision

We expect the RBNZ to leave rates on hold at 5.5% at its February 28 meeting even though the labour market data were stronger than expected. It has been on hold since it last hiked in May last year and given that policy is restrictive and its last OCR profile didn't have any easing until H1 2025, we think that the RBNZ is more likely to keep rates "high for longer" rather than tighten again. The MPC is likely to sound cautious and there will be a lot of attention on the press conference and updated staff forecasts, with the timing of the return to target and the OCR profile of particular interest.

THURSDAY - US PCE Inflation

The January PCE deflator (out Thursday) will be the last reading of the Fed's preferred inflation gauge before the March FOMC meeting. Median analyst estimates for the headline reading based on strong January CPI and PPI inputs is 2.4% Y/Y and 0.3% M/M, with core seen at 2.8% Y/Y / 0.4% M/M - each of which would represent a stepdown on an annual basis but a monthly acceleration. On Feb 22, Federal Reserve Vice Chair Jefferson revealed that the Fed staff's estimates of PCE are exactly in line with analyst estimates - which incorporate what he called a "somewhat larger" and "disappointing" CPI reading which "highlights that the disinflation process is likely to be bumpy." Aside from the overall readings, there will be close attention paid to further deterioration in core services ex housing "supercore" inflation, which registered 0.28% M/M in December.

THURSDAY/FRIDAY - Eurozone Flash February Inflation

The Eurozone February flash inflation round begins next Thursday with France, Spain and Germany (where, as usual, state-level data precedes the release of the national print). The Eurozone-wide estimate is released at 1000GMT/1100CET on Friday (alongside Italy), with an early consensus looking for core HICP at 2.9% Y/Y (vs 3.3% prior) and headline at 2.5% Y/Y (vs 2.8% prior). While a deceleration in core inflation to sub-3% for the first time since February 2022 will be encouraging for the ECB on the surface, Commerzbank note that the decline is largely due to base effects and inflation momentum is still at risk of accelerating on the month. Wage pressures continue to be cited as an upside driver of services inflationary pressures in the PMIs, but the latest flash round indicated that Red Sea tensions were having a limited impact on manufactures - a positive development for the core goods outlook.

DateGMT/LocalImpactFlagCountryEvent
26/02/20240800/0900**ES PPI
26/02/20240900/0900UK BOE's Breeden at BOE agenda for Research Conference
26/02/20241100/1100**UK CBI Distributive Trades
26/02/20241100/1100UK BOE's Pill at BOE Agenda for Research conference
26/02/20241500/1000***US New Home Sales
26/02/20241530/1030**US Dallas Fed manufacturing survey
26/02/20241600/1700EU ECB's Lagarde participates in debate on ECB 2022 Report
26/02/20241630/1130*US US Treasury Auction Result for 2 Year Note
26/02/20241630/1130*US US Treasury Auction Result for 26 Week Bill
26/02/20241800/1300*US US Treasury Auction Result for 13 Week Bill
26/02/20241800/1300*US US Treasury Auction Result for 5 Year Note
27/02/20242330/0830***JP CPI
27/02/20240001/0001*UK BRC Monthly Shop Price Index
26/02/20240040/1940US Kansas City Fed's Jeff Schmid
27/02/20240700/0800*DE GFK Consumer Climate
27/02/20240745/0845**FR Consumer Sentiment
27/02/20240900/1000**EU M3
27/02/20241000/1000*UK Index Linked Gilt Outright Auction Result
27/02/20241330/0830*CA Capital and repair expenditure survey
27/02/20241330/0830**US Durable Goods New Orders
27/02/20241340/1340UK BOE's Ramsden at Association for Financial Markets
27/02/20241355/0855**US Redbook Retail Sales Index
27/02/20241400/0900**US S&P Case-Shiller Home Price Index
27/02/20241400/0900**US FHFA Home Price Index
27/02/20241400/0900**US FHFA Home Price Index
27/02/20241400/0900**US FHFA Quarterly Price Index
27/02/20241400/0900**US FHFA Quarterly Price Index
27/02/20241405/0905US Fed Vice Chair Michael Barr
27/02/20241500/1000***US Conference Board Consumer Confidence
27/02/20241500/1000**US Richmond Fed Survey
27/02/20241530/1030**US Dallas Fed Services Survey
27/02/20241630/1130*US US Treasury Auction Result for Cash Management Bill
27/02/20241800/1300**US US Treasury Auction Result for 7 Year Note
28/02/20240030/1130***AU CPI Inflation Monthly
28/02/20240030/1130***AU Quarterly construction work done
28/02/20240100/1400***NZ RBNZ official cash rate decision
28/02/20240700/0800**SE PPI
28/02/20240700/1500**CN MNI China Liquidity Index (CLI)
28/02/20240900/1000**IT ISTAT Consumer Confidence
28/02/20240900/1000**IT ISTAT Business Confidence
28/02/20241000/1100**EU EZ Economic Sentiment Indicator
28/02/20241000/1100*EU Consumer Confidence, Industrial Sentiment
28/02/20241100/1200EU ECB's Lagarde and Cipollone in G20 and CB Governors meeting
28/02/20241200/0700**US MBA Weekly Applications Index
28/02/20241330/0830*CA Current account
28/02/20241330/0830*CA Payroll employment
28/02/20241330/0830***US GDP
28/02/20241330/0830**US Advance Trade, Advance Business Inventories
28/02/20241530/1030**US DOE Weekly Crude Oil Stocks
28/02/20241530/1530UK BOE's Mann at FT future forum event 'The economic outlook..'
28/02/20241700/1200US Atlanta Fed's Raphael Bostic
28/02/20241715/1215US Boston Fed's Susan Collins
28/02/20241745/1245US New York Fed's John Williams
29/02/20242350/0850*JP Retail sales (p)
29/02/20242350/0850**JP Industrial production
29/02/20240030/1130*AU Private New Capex and Expected Expenditure
29/02/20240700/0800**DE Retail Sales
29/02/20240700/0800**SE Retail Sales
29/02/20240700/0800***SE GDP
29/02/20240745/0845***FR GDP (f)
29/02/20240745/0845**FR Consumer Spending
29/02/20240745/0845***FR HICP (p)
29/02/20240745/0845**FR PPI
29/02/20240800/0900***ES HICP (p)
29/02/20240800/0900**CH KOF Economic Barometer
29/02/20240800/0900***CH GDP
29/02/20240855/0955**DE Unemployment
29/02/20240900/1000***DE North Rhine Westphalia CPI
29/02/20240900/1000***DE Bavaria CPI
29/02/20240930/0930**UK BOE M4
29/02/20240930/0930**UK BOE Lending to Individuals
29/02/20241300/1400***DE HICP (p)
29/02/20241330/0830***US Jobless Claims
29/02/20241330/0830**US WASDE Weekly Import/Export
29/02/20241330/0830***CA GDP - Canadian Economic Accounts
29/02/20241330/0830***CA Gross Domestic Product by Industry
29/02/20241330/0830***CA CA GDP by Industry and GDP Canadian Economic Accounts Combined
29/02/20241330/0830**US Personal Income and Consumption
29/02/20241445/0945***US MNI Chicago PMI
29/02/20241500/1000**US NAR Pending Home Sales
29/02/20241530/1030**US Natural Gas Stocks
29/02/20241550/1050US Atlanta Fed's Raphael Bostic
29/02/20241600/1100US Chicago Fed's Austan Goolsbee
29/02/20241600/1100**US Kansas City Fed Manufacturing Index
29/02/20241815/1315US Cleveland Fed's Loretta Mester
01/03/20242200/0900**AU S&P Global Manufacturing PMI (f)
01/03/20242330/0830*JPLabour force survey
01/03/20240030/0930**JP S&P Global Final Japan Manufacturing PMI
29/02/20240110/2010US New York Fed's John Williams
01/03/20240130/0930***CN CFLP Manufacturing PMI
01/03/20240130/0930**CN CFLP Non-Manufacturing PMI
01/03/20240145/0945**CN S&P Global Final China Manufacturing PMI
01/03/20240730/0830**CH Retail Sales
01/03/20240815/0915**ES S&P Global Manufacturing PMI (f)
01/03/20240845/0945**IT S&P Global Manufacturing PMI (f)
01/03/20240850/0950**FR Manufacturing PMI (f)
01/03/20240855/0955**DES&P Global Manufacturing PMI (f)
01/03/20240900/1000**EU S&P Global Manufacturing PMI (f)
01/03/20240930/0930**UK S&P Global Manufacturing PMI (Final)
01/03/20241000/1100***EU HICP (p)
01/03/20241000/1100**EU Unemployment
01/03/20241000/1100***IT HICP (p)
01/03/2024-***US Domestic-Made Vehicle Sales
01/03/20241400/1400UK BOE's Pill Speech at Cardiff University
01/03/20241445/0945***US S&P Global Manufacturing Index (final)
01/03/20241500/1000***US ISM Manufacturing Index
01/03/20241500/1000**US U. Mich. Survey of Consumers
01/03/20241500/1000*US Construction Spending
01/03/20241515/1015US Fed Governor Chris Waller
01/03/20241715/1215US Atlanta Fed's Raphael Bostic
01/03/20241800/1300**US Baker Hughes Rig Count Overview - Weekly
01/03/20241830/1330US San Francisco Fed's Mary Daly
01/03/20242030/1530US Fed Governor Adriana Kugler

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