Analysts at National Bank Financial suggest that in the US this week, the highlight of the week will be the central bank’s monetary policy meeting.
Key Quotes
“Keeping in accordance with its most recent communications, which emphasized the central bank’s wait-and-see approach, the Fed will stay on the sidelines this time. It will still be interesting to hear Jerome Powell’s comments as he gives his first press conference of the year. Non-farm payrolls for January will also be available this week.”
“We expect underwhelming numbers (+100K) even though jobless claims continued to hover near record lows in the month. That is partly due to the government shutdown, but also to the sheer strength of the previous report (+310K), which suggests a giveback is likely this time. The unemployment rate, for its part, may slide one tick to 3.8% if, as we believe, the household survey shows moderate employment gains.”
“Still in January, the ISM manufacturing index could have increased slightly, in line with the gains recorded by Markit’s manufacturing PMI in the month. In other news, the annual core PCE deflator could have stayed put in December at 1.9%, just below the Fed’s target.”
“Several other economic indicators were supposed to come out this week including GDP (Q4), personal income (December), and personal spending (December). Those releases are likely to be postponed due to the government shutdown. As an indication, data published so far suggests the U.S. economy may have grown at an annualized pace of around 2.5% in Q4.”
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