MNI Global Week Ahead - Heavy Central Bank Week To End 2024
See below for the key events in developed and emerging markets next week:
Developed Markets
TUESDAY / WEDNESDAY / THURSDAY - UK Labour Market / CPI Data and BOE Decision
The week ahead sees UK flash PMIs, labour market data, inflation and the BOE monetary policy decision all due. The BOE will announce its policy decision on Thursday (after receiving early access to the labour market and inflation data on Monday morning). Bank Rate is widely expected to remain at 4.75%. Depending on the preceding data we expect the vote to range from 8-1 to 6-3 (with Dhingra very likely to dissent for a 25bp cut and possibly joined by Taylor and / or Ramsden). We would be surprised if there was a wholesale change to the guidance. The early consensus looks for marginal increases in the manufacturing, services and composite PMIs and an increase in inflation from 3.3%Y/Y to 3.6%Y/Y with a small pick up in services CPI from 5.0%Y/Y to 5.1%Y/Y.
WEDNESDAY - Fed Decision
The final FOMC meeting of the year will bring updated quarterly projections alongside a very likely 25bp rate cut. With the unemployment rate likely to undershoot September’s median projection along with core PCE inflation and GDP growth overshooting, the FOMC will signal a more cautious approach to easing. This will be communicated most clearly in the updated Dot Plot, which is set to show 75bp of cuts in 2025 – 25bp less than the 100bp in the last edition - with 2026, 2027, and the Longer-Run dot in line for increases. The hawkish risk at this meeting comes not just from a potential signalling of just 50bp of cuts in 2025, but negative market reaction to a higher terminal rate forecast, with a funds rate that settles above 3%. The new forecasts are not likely to explicitly incorporate anticipated policy shifts under the incoming Trump administration, but as with the corresponding post-election meeting in 2016 we expect the FOMC to discuss the macro and rates implications, with more participants seeing upside risks to inflation and rates. This could result in a hawkish flavor to the communications tone. While Powell is unlikely to rule out a cut at the next meeting, reiterating that the Fed is moving meeting-by meeting while remaining confident inflation remains on a path to 2%, expect him to emphasize increasing uncertainty over the path ahead.
THURSDAY - BoJ Decision
Expectations for the next BoJ shift are moving into 2025, from both a market pricing and sell-side consensus standpoint. Media snippets have suggested the BoJ sees little risks in waiting for 2025 for its next policy move. Our own policy team has also highlighted the domestic political backdrop as a constraint on sharp policy shifts. Recent data outcomes support further easing, but also don't point to a near term urgency to shift. Our bias is for a steady hand at next week's BoJ policy meeting outcome.
THURSDAY - Riksbank Decision
The Riksbank is expected to bring its policy rate to 2.50% with a 25bp cut in December. Although inflation has tracked a little above the September MPR projections over the past three months, continued softness in domestic economic activity means there is little reason for the Executive Board to go against its November guidance. The December decision includes an updated monetary policy report and rate path projection. Since the September rate path only incorporated a small implied probability of a 50bp cut in November or December, we should see a mechanical shift lower at the front-end of the December path. As such, the “terminal” rate should also see a small downward revision from the current level of 2.25%.
THURSDAY - Norges Bank Decision
Norges Bank has signalled since September that policy rates will likely be kept at 4.50% through the end of 2024. As such, anything other than another hold in rates would be a significant surprise to markets. The September MPR rate path assigned a near-certain implied probability of a 25bp cut in Q1 2025, so it won’t be a surprise for Norges Bank to signal such an intention in the December policy statement. Immediate focus will be on whether it indicates that a cut is more likely in January (an interim meeting) or March (an MPR meeting). The December decision includes an updated MPR and rate path projection. The rate path is likely to continue to indicate a very gradual easing cycle through to 2026.
Emerging Markets
TUESDAY - NBH Decision (Hungary)
The NBH is expected keep its base rate unchanged at 6.50%. A somewhat more stable backdrop for the HUF across December and no change in regime at the central bank until March means we are unlikely to see any material changes to the central bank’s hawkish communications either.
TUESDAY - BCCh Decision (Chile)
Latest activity and inflation data have evolved in line with expectations, consistent with the BCCh cutting the overnight rate by 25bps to 5.00% next week. Central bank economist and trader surveys corroborate this sentiment, also forecasting a pause in January. Analysts don’t expect major changes to the policy rate corridor in the upcoming IPoM, with market expectations likely to consolidate around the upper bound of the neutral rate range (4.5%).
WEDNESDAY - BoT Decision (Thailand)
The BoT is likely to hold steady at next week's policy meeting. The central bank has spoken about preserving policy space. Domestic political pressures remains for easier policy settings, but we don't expect the central bank to ease further next week.
WEDNESDAY - BI Decision (Indonesia)
The sell-side consensus is for a 25bps cut next week by BI, albeit just. We see merits for lower policy rates, but with USD/IDR pressing towards 16000, fresh multi month highs, we might see financial stability concerns outweigh in the near term. Hence we rates on hold next week, but we recognize it is a close call.
THURSDAY - BSP Decision (Philippines)
Being one of the first Central Banks to cut rates back in August, the Philippines, the BSP followed that with a cut in October. For the last meeting of the year on December 19, the market expects a further cut. Since the October cut exports have been very weak with October seeing a contraction of -5.5%. Third quarter GDP surprised to the downside at +5.2% and although the November m/m CPI release ticked up marginally, it is not enough to delay another cut.
THURSDAY - Czech Republic
Analyst consensus has been converging around the view that the CNB could halt its monetary easing cycle in December. Several policymakers put a pause on the table in recent communications and emphasised the need for caution.
THURSDAY - Banxico Decision (Mexico)
Following the dovish tilt to Banxico’s unanimous cut in November, subsequent central bank rhetoric has evolved in a similar direction. While most analysts expect another 25bp move to 10.00% next week, there are calls for the committee to step up the pace of easing. Indeed, Governor Rodriguez has not ruled out larger cuts ahead, appearing content with latest developments in the currency market and the markets interpretation of the latest budget proposal for 2025.
FRIDAY - BanRep (Colombia)
BanRep is expected to continue its gradual pace of easing, cutting rates by 50bp to 9.25%. Heightened fiscal concerns and COP weakness across H2 threaten to derail the disinflation process, dispelling the chance to increase the easing pace. Indeed, calls for bolder policy easing had been spearheaded by the now ex-finance minister Ricardo Bonilla, who is expected to be replaced this month by his successor Diego Guevara.
Date | GMT/Local | Impact | Country | Event |
16/12/2024 | 2200/0900 | *** | AU | Judo Bank Flash Australia PMI |
16/12/2024 | 2350/0850 | * | JP | Machinery orders |
16/12/2024 | - | GB | Bank of England Meeting | |
16/12/2024 | 0030/0930 | ** | JP | Jibun Bank Flash Japan PMI |
16/12/2024 | 0200/1000 | *** | CN | Fixed-Asset Investment |
16/12/2024 | 0200/1000 | *** | CN | Retail Sales |
16/12/2024 | 0200/1000 | *** | CN | Industrial Output |
16/12/2024 | 0200/1000 | ** | CN | Surveyed Unemployment Rate M/M |
16/12/2024 | 0700/0800 | EU | ECB's Lagarde press conference with Bank of Lithuania | |
16/12/2024 | 0815/0915 | ** | FR | S&P Global Services PMI (p) |
16/12/2024 | 0815/0915 | ** | FR | S&P Global Manufacturing PMI (p) |
16/12/2024 | 0815/0915 | EU | ECB's Lagarde speech on resilience amid geopolitical shift | |
16/12/2024 | 0830/0930 | ** | DE | S&P Global Services PMI (p) |
16/12/2024 | 0830/0930 | ** | DE | S&P Global Manufacturing PMI (p) |
16/12/2024 | 0830/0930 | EU | ECB's Lagarde in panel on pillars of resilience | |
16/12/2024 | 0845/0945 | EU | ECB's De Guindos remarks at Madrid Foro Empresarial | |
16/12/2024 | 0900/1000 | ** | IT | Italy Final HICP |
16/12/2024 | 0900/1000 | ** | EU | S&P Global Services PMI (p) |
16/12/2024 | 0900/1000 | ** | EU | S&P Global Manufacturing PMI (p) |
16/12/2024 | 0900/1000 | ** | EU | S&P Global Composite PMI (p) |
16/12/2024 | 0930/0930 | *** | GB | S&P Global Manufacturing PMI flash |
16/12/2024 | 0930/0930 | *** | GB | S&P Global Services PMI flash |
16/12/2024 | 0930/0930 | *** | GB | S&P Global Composite PMI flash |
16/12/2024 | - | CA | Canada presents fiscal update, time TBD. | |
16/12/2024 | 1315/0815 | ** | CA | CMHC Housing Starts |
16/12/2024 | 1330/0830 | ** | US | Empire State Manufacturing Survey |
16/12/2024 | 1400/0900 | * | CA | CREA Existing Home Sales |
16/12/2024 | 1445/0945 | *** | US | S&P Global Manufacturing Index (Flash) |
16/12/2024 | 1445/0945 | *** | US | S&P Global Services Index (flash) |
16/12/2024 | 1630/1730 | EU | ECB's Schnabel speech at CEPR symposium | |
16/12/2024 | 1630/1130 | * | US | US Treasury Auction Result for 26 Week Bill |
16/12/2024 | 1630/1130 | * | US | US Treasury Auction Result for 13 Week Bill |
16/12/2024 | 2020/1520 | CA | BOC Governor Macklem speaks in Vancouver. | |
17/12/2024 | 0700/0700 | *** | GB | Labour Market Survey |
17/12/2024 | 0900/1000 | *** | DE | IFO Business Climate Index |
17/12/2024 | 1000/1100 | *** | DE | ZEW Current Conditions Index |
17/12/2024 | 1000/1100 | *** | DE | ZEW Current Expectations Index |
17/12/2024 | 1000/1100 | * | EU | Trade Balance |
17/12/2024 | 1000/1000 | ** | GB | Gilt Outright Auction Result |
17/12/2024 | 1000/1100 | EU | ECB's Elderson at ECB Banking Supervision conference | |
17/12/2024 | 1330/0830 | * | CA | International Canadian Transaction in Securities |
17/12/2024 | 1330/0830 | *** | CA | CPI |
17/12/2024 | 1330/0830 | *** | US | Retail Sales |
17/12/2024 | 1355/0855 | ** | US | Redbook Retail Sales Index |
17/12/2024 | 1415/0915 | *** | US | Industrial Production |
17/12/2024 | 1500/1000 | * | US | Business Inventories |
17/12/2024 | 1500/1000 | ** | US | NAHB Home Builder Index |
17/12/2024 | 1630/1130 | * | US | US Treasury Auction Result for Cash Management Bill |
17/12/2024 | 1800/1300 | ** | US | US Treasury Auction Result for 20 Year Bond |
18/12/2024 | - | JP | Bank of Japan Meeting | |
18/12/2024 | - | SE | Riksbank Meeting | |
18/12/2024 | 0700/0700 | *** | GB | Consumer inflation report |
18/12/2024 | 0700/0700 | *** | GB | Producer Prices |
18/12/2024 | 0700/1500 | ** | CN | MNI China Money Market Index (MMI) |
18/12/2024 | 0900/1000 | EU | ECB's Lane in fireside chat at MNI Connect Event | |
18/12/2024 | 1000/1100 | *** | EU | HICP (f) |
18/12/2024 | 1000/1100 | ** | EU | Construction Production |
18/12/2024 | 1100/1100 | ** | GB | CBI Industrial Trends |
18/12/2024 | 1200/0700 | ** | US | MBA Weekly Applications Index |
18/12/2024 | 1330/0830 | * | US | Current Account Balance |
18/12/2024 | 1330/0830 | *** | US | Housing Starts |
18/12/2024 | 1530/1030 | ** | US | DOE Weekly Crude Oil Stocks |
18/12/2024 | 1900/1400 | *** | US | FOMC Statement / S.E.P. |
19/12/2024 | 2145/1045 | *** | NZ | GDP |
19/12/2024 | - | NO | NorgesBank Meeting | |
19/12/2024 | 0001/0001 | * | GB | Brightmine pay deals for whole economy |
19/12/2024 | 0300/1200 | *** | JP | BOJ Policy Rate Announcement |
19/12/2024 | 0700/0800 | * | DE | GFK Consumer Climate |
19/12/2024 | 0745/0845 | ** | FR | Manufacturing Sentiment |
19/12/2024 | 0830/0930 | *** | SE | Riksbank Interest Rate Decison |
19/12/2024 | 0900/1000 | *** | NO | Norges Bank Rate Decision |
19/12/2024 | 0900/1000 | ** | EU | EZ Current Account |
19/12/2024 | 1200/1200 | *** | GB | Bank Of England Interest Rate |
19/12/2024 | 1200/1200 | GB | BOE MPS and Minutes | |
19/12/2024 | 1200/1200 | GB | BOE Agents' summary of business conditions | |
19/12/2024 | 1330/0830 | *** | US | Jobless Claims |
19/12/2024 | 1330/0830 | *** | US | GDP |
19/12/2024 | 1330/0830 | * | CA | Payroll employment |
19/12/2024 | 1330/0830 | ** | US | Philadelphia Fed Manufacturing Index |
19/12/2024 | 1330/0830 | ** | US | WASDE Weekly Import/Export |
19/12/2024 | 1500/1000 | *** | US | NAR existing home sales |
19/12/2024 | 1530/1030 | ** | US | Natural Gas Stocks |
19/12/2024 | 1600/1100 | ** | US | Kansas City Fed Manufacturing Index |
19/12/2024 | 1800/1300 | ** | US | US Treasury Auction Result for TIPS 5 Year Note |
19/12/2024 | 1900/1400 | *** | MX | Mexico Interest Rate |
19/12/2024 | 2100/1600 | ** | US | TICS |
20/12/2024 | 2330/0830 | *** | JP | CPI |
20/12/2024 | 0700/0700 | *** | GB | Public Sector Finances |
20/12/2024 | 0700/0800 | ** | DE | PPI |
20/12/2024 | 0700/0800 | ** | SE | PPI |
20/12/2024 | 0700/0800 | ** | SE | Retail Sales |
20/12/2024 | 0700/0700 | *** | GB | Retail Sales |
20/12/2024 | 0745/0845 | ** | FR | PPI |
20/12/2024 | 0800/0900 | ** | SE | Economic Tendency Indicator |
20/12/2024 | 0900/1000 | ** | IT | ISTAT Business Confidence |
20/12/2024 | 0900/1000 | ** | IT | ISTAT Consumer Confidence |
20/12/2024 | 0900/1000 | ** | IT | PPI |
20/12/2024 | 1100/1100 | ** | GB | CBI Distributive Trades |
20/12/2024 | 1330/0830 | *** | US | Personal Income and Consumption |
20/12/2024 | 1330/0830 | ** | CA | Retail Trade |
20/12/2024 | 1330/0830 | ** | CA | Retail Trade |
20/12/2024 | 1400/1500 | ** | BE | BNB Business Confidence |
20/12/2024 | 1500/1600 | ** | EU | Consumer Confidence Indicator (p) |
20/12/2024 | 1500/1000 | ** | US | U. Mich. Survey of Consumers |
20/12/2024 | 1630/1630 | GB | BOE to announce Q1-25 APF sales schedule |