back
Details Cookies
Cookie policy

This website uses cookies to offer you a better browsing experience by enabling, optimising and analysing site operations, as well as to provide personalised ad content and allow you to connect to social media. By choosing “Accept all” you consent to the use of cookies and the related processing of personal data. Select “Manage consent” to manage your consent preferences. You can change your preferences or retract your consent at any time via the cookie policy page. Please view our cookie policy here and our privacy policy here

Macro brief : The week ahead Macro brief : The week ahead Macro brief : The week ahead

Macro brief : The week ahead

Macro 4 minutes to read
Christopher Dembik

Head of Macroeconomic Research

Summary:  As fears of a global recession ratchet higher, the economic calendar for the week ahead offers a bunch of key indicators that may provide further fuel to the thinking that bad times lie ahead.


The dovish signal from the Fed last week is likely to drive EM FX and stocks higher in the short and medium term but the next catalyst for the market needs to come from China’s stimulus. Though Chinese data remains disappointing (for instance, retail sales growth is still weakening, even ex-autos), there are early signs that infrastructure and industrial production have bottomed. We still expect economic stabilisation to happen in China in Q3 2019. In the interim, the global slowdown should continue, as confirmed by the very ugly PMI flash indicator for March released for France and Germany last Friday. 

This week, there are three themes that are likely to dominate the thinking of investors and traders. 

(1) In Germany, we expect a couple of negative prints, notably the GfK consumer confidence indicator and the  Ifo business climate index. The adverse bias for soft data remains due to the risk of a global trade recession and China’s slowdown. The perspectives for the automotive sector, which represents roughly 14% of German GDP, are very gloomy as the two main car markets at the global level – the United States and China – are showing signs of deep weakness. We consider that this negative momentum in Germany could have a positive outcome in the second half of  2019 as it might push the German government to adopt an expansionist fiscal policy. 

(2) In France, Q4 GDP is due on Tuesday. It should confirm that quarterly growth reached 0.3% which is still a decent performance considering the negative consequences on business and consumer confidence of the Yellow Vest movement. Based on INSEE’s estimates, the Yellow Vest’s negative effect on growth was rather limited, around 0.1 point of GDP. The economic momentum for 2019 is positive due to measures to support purchasing power that represent a fiscal stimulus of 10 billion euros. France’s GDP growth forecast for 2019 is at 1.3% vs 0.6% for Germany. 

(3) Finally, the last theme this week is de-dollarisation. We had new gold data from the Central Bank of Russia a few days ago. Russia bought 31.1 tons in February, bringing the al to 2,149 tons. As we wrote in January, de-dollarisation is a long-term process that will be key to monitoring developments this year. Interestingly, we're starting to hear from Washington that the Trump administration is trying to set up a plan to counter this phenomenon. Stay tuned.

Today's Calendar (All times GMT)

9:00 Germany, Ifo business climate indicator
10: 00 USA, Harker (FOMC)
12:30 USA, Chicago Fed national activity index
14:30 USA, Texas manufacturing outlook survey
21:45 New Zealand, trade balance
Brexit is supposed not to be on the agenda today but there is noise that PM May could face a cabinet revolt by midday. 


Boulevard Plaza, Tower 1, 30th floor, office 3002
Downtown, P.O. Box 33641 Dubai, UAE

Contact Saxo

Select region

UAE
UAE

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

Saxo Bank A/S is licensed by the Danish Financial Supervisory Authority and operates in the UAE under a representative office license issued by the Central bank of the UAE.

The content and material made available on this website and the linked sites are provided by Saxo Bank A/S. It is the sole responsibility of the recipient to ascertain the terms of and comply with any local laws or regulation to which they are subject.

The UAE Representative Office of Saxo Bank A/S markets the Saxo Bank A/S trading platform and the products offered by Saxo Bank A/S.