According to analysts at Nordea markets, the Chinese Q1 GDP will likely attract more attention than usual next week (Wednesday), as the Chinese slowdown has been one of the main catalysts of the slowdown elsewhere around the globe.
Key Quotes
“We don’t see much value in the GDP print (it is old news and likely “decorated”), but we still await further signals whether e.g. US durable goods will take a beating due to plummeting Chinese imports. The slowing auto sales in China is another indicator that we continue to watch.”
“In the US we will likely get signs of a rebound in the domestic economy from the retail sales figure in March. The early spend-trend data suggest a big rebound in US retail sales in March (Thursday). This will be welcomed news for the upcoming Q1 GDP print in the US that otherwise looked mediocre at best.”
“The Philly Fed index rebounded last month, but the horrible details were mostly overlooked by market participants. The leading components of the Philly Fed look almost as worrisome as in 06/07, why risks are tilted to the downside for the Philly Fed index (and subsequently ISM) on Thursday.”
“In the Euro area, we will get a big test of the “green shoots” hypothesis on Thursday, when the preliminary April PMIs are out. If we allow Sweden to be the “objective” judge of the Euro-area manufacturing PMI, then there is probably another weak print left before the probability of a rebound increases. The big if is whether the service sector will be hit by spill-overs as well.”
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