Key Events In The Coming US

The main focus this week will be on President Trump’s speech to Congress and Chair Yellen’s speech which is the last before the blackout period. US durable goods, ISM, the BoC rate decision, EZ CPI, UK PMIs and a busy calendar in Australia & Scandinavia also coming up.

Investors are hoping that the long-awaited speech from President Trump to a joint session of Congress will deliver more clarity on the agenda for the new administration. Meanwhile, Fed Chair Yellen’s speech on Friday will be the final piece of communication from the Fed before the new blackout period, and should set the tone heading into the next FOMC meeting.

Elsewhere, there will be MP meetings in Hungary, Malaysia, Israel & Ukraine. Ratings reviews are scheduled in Hungary, Lebanon & Qatar.

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In addition to Trump’s address to Congress on Tuesday at 9pm which is the main event for markets this week, there’s still a relatively packed data docket to get through with the final PMI’s in Europe to be confirmed on Friday, a second reading of Q4 GDP in the US tomorrow and also an economic outlook speech by Fed Chair Yellen on Friday in Chicago. On that it’s worth noting that the March hike probability did steadily climb last week to 40% on Friday from 34% the week prior based on Bloomberg’s calculator but you’d imagine that in order for the Fed to really have the option of hiking next month, Yellen will have to make a much stronger case relative to what’s been said recently.

As Goldman summarizes, the key economic releases this week are the durable goods report on Monday, the second estimate of Q4 GDP on Tuesday, the ISM and PCE reports on Wednesday, and the ISM non-manufacturing report on Friday. In addition, there are several scheduled speaking engagements from Fed officials this week, including speeches by Federal Reserve Chair Yellen and Vice Chair Fischer on Friday. The Beige Book for the March FOMC period will be released on Wednesday.

In other data

  • In the US, in addition to the Trump, Yellen and Fischer speeches, we also get a number of data releases including durable goods, personal income & spending, ISM, construction spending, vehicle sales and several other Fed speakers.
  • In the Eurozone, the main focus will be on inflation data, with preliminary releases from Spain, France Italy and Germany, as well as the aggregate print. The French election ‘poll watch’ also continues, with the next key event the publication of Emmanuel Macron’s manifesto on March 2nd.
  • In the UK, PMIs will be the main release, but note also the M4 report with data on foreign purchases of Gilts. The House of Lords also begin detailed examination of the Brexit Bill and can propose amendments.
  • In Japan, we get inflation and labor market data as well as retail sales and IP.
  • A busy week ahead in Australia. Q4 GDP will be the key release, with growth expected to rebound after the negative print in Q3. We receive the partial indicators of Balance of Payment, company profits and inventories ahead of the GDP release, and also monthly activity indicators of private sector credit, house prices, building approvals and trade.

A breakdown of key events by day courtesy of DB:

It’s a quiet start to the week in Europe this morning with just February confidence indicators for the Euro area due out. In the US this afternoon we’ll get a first look at the January durable and capital goods orders data as well as pending home sales and the Dallas Fed manufacturing survey index.

Tuesday kicks off in Japan where the latest retail sales, housing starts and industrial production data are due. In the European session we’ll get France CPI, PPI and Q4 GDP and the February CPI estimate for the Euro area. Trump’s speeceh will be the key political and market highlight.

Over in the US it’s all eyes on the second reading of Q4 GDP, while core PCE, wholesale inventories, advance goods trade balance, S&P/Case Shiller house price index, Chicago PMI and Richmond Fed manufacturing survey round out a busy day of releases.

In Asia on Wednesday the early focus is on the official manufacturing and services PMI’s in China. Over in Europe we’ll then get the final February manufacturing PMI’s followed by CPI in Germany and UK credit and money aggregates data. In the US there is more important data in the form of the January core and deflator PCE readings, ISM manufacturing, construction spending, vehicles sales and the final manufacturing PMI. Thursday looks set to be quieter with just Euro area PPI due in the morning and initial jobless claims in the US.

We end the week on Friday in Japan with CPI and the latest employment  numbers. China will also release the Caixin services and composite prints. In Europe we get the remaining services and composite PMI revisions for February as well as Euro area retail sales. The final services and composites are then due in the US alongside the ISM non-manufacturing print.

Away from the data the Fedspeak during the week consists of Kaplan today, Williams and Bullard on Tuesday, Kaplan and Brainard on Wednesday and then a bumper day on Friday headlined by Fed Chair Yellen when she gives an economic outlook speech in Chicago. Fischer, Powell, Evans, Lacker and Mester will also speak. Away from that, arguably the biggest event of the week is President Trump’s address to a joint session of Congress at 9pm ET in the US on Tuesday (early Wednesday morning in the UK). Also worth noting is the House of Lords debate on Brexit where talks are due to start about a more detail examination of the proposed bill.

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A table summary of key US events:

Goldman breaks down the week’s key events together with consensus estimates:

Monday, February 27

  • 08:30 AM Durable goods orders, January preliminary (GS +2.0%, consensus +1.7%, last -0.5%); Durable goods orders ex-transportation, January preliminary (GS flat, consensus +0.5%, last +0.5%);
    Core capital goods orders, January preliminary (GS +0.2%, consensus +0.5%, last +0.7%); Core capital goods shipments, January preliminary (GS +0.2%, consensus +0.2%, last +1.0%): We expect durable goods orders to rise 2.0% reflecting a seasonally adjusted rebound in commercial aircraft orders following weaker-than-expected results in December. However, our expectations for the core measures are low. Despite strong manufacturing survey data in January and encouraging company results and commentary, we expect only a 0.2% increase in both core capital goods orders and core capital goods orders shipments, reflecting mean reversion, Chinese New Year effects, and the lagged impact of dollar strength. January industrial production of business equipment was also surprisingly soft, edging up just 0.1%. We expect durable goods orders ex-transportation to remain unchanged.
  • 10:00 AM Pending home sales, January (GS -1.0%, consensus +1.0%, last +1.6%): Despite generally favorable weather, regional housing data released so far suggest a pullback in contract signings for existing homes in January, possibly reflecting the recent rise in mortgage rates that may have weighed on the new homes sales report last week. We expect a 1% drop in the pending homes sales index, which would mostly reverse December’s 1.6% increase. We have found pending home sales to be a useful leading indicator of existing home sales with a one- to two-month lag.
  • 10:30 AM Dallas Fed manufacturing index, February (consensus +19.4, last +22.1)
  • 11:00 AM Dallas Fed President Kaplan (FOMC voter) speaks: Dallas Federal Reserve President Robert Kaplan will participate in a moderated discussion at the Price College of Business at the University of Oklahoma. Audience and media Q&A is expected.

Tuesday, February 28

  • 08:30 AM GDP (second), Q4 (GS +2.1%, consensus +2.1%, last +1.9%); Personal consumption, Q4 (GS +2.6%, consensus +2.5%, last +2.5%): We expect a two-tenths upward revision in the second estimate of Q4 GDP, featuring a one-tenth upward revision to personal consumption (to +2.6%) and additional upward revisions to residential investment and private inventories.
  • 08:30 AM U.S. Census Bureau Report on Advance Economic Indicators; Advanced goods trade balance, January (GS -$66.4bn, consensus -$66.0bn, last -$64.4bn); Wholesale inventories, January preliminary (consensus +0.4%, last +1.0%): We expect the goods trade deficit to widen $2bn to $66.4bn in January following last month’s $1.2bn tightening, reflecting higher nominal petroleum imports and the relatively early Chinese New Year, which is likely shifting the timing of imports from February to January and could also delay some capital goods exports. Available port statistics suggest an improvement in both inbound and outbound container traffic, suggestive of an increase in gross trade volumes.
  • 09:00 AM S&P/Case-Shiller 20-city home price index, December (GS +0.9%, consensus +0.7%, last +0.9%): We expect the S&P/Case-Shiller 20-city home price index to rise 0.9% in the December report following a 0.9% increase in the prior month. The measure still appears to be influenced by seasonal adjustment challenges, and we place more weight on the year-over-year increase, which at 5.3% is in line with recent trends.
  • 09:45 AM Chicago PMI, February (GS 54.0, consensus 53.0, last 50.3): We expect the Chicago PMI to increase to 54.0 in February after falling to 50.3 in the January report. Our slightly-above-consensus forecast reflects the general improvement in manufacturing surveys as well as encouraging commentary from industrial firms.
  • 10:00 AM Conference Board consumer confidence, February (GS 111.5, consensus 111.0, last 111.8): We expect consumer confidence to remain relatively stable at 111.5 following last month’s 1.5pt pullback to 111.8. Our forecast reflects encouraging consumer sentiment measures in February as well as recent stock market strength.
  • 10:00 AM Richmond Fed manufacturing index, February (consensus +10, last +12)
  • 12:45 PM Kansas City Fed President George (FOMC non-voter) speaks: Kansas City Fed President Esther George will give the keynote speech on the U.S. economy and monetary policy at “Banking and the Economy: A Forum for Women in Banking” in Midwest City, Oklahoma. Audience Q&A is expected.
  • 03:00 Philadelphia Fed President Harker (FOMC voter) speaks: Philadelphia Fed President Patrick Harker will give a speech on the economic outlook at the 16th Annual Economic Outlook event at LaSalle University in Philadelphia, Pennsylvania.
  • 03:30 PM San Francisco Fed President Williams (FOMC non-voter) speaks: Federal Reserve Bank of San Francisco President John Williams will give a speech on the economic outlook at the Santa Cruz Chamber of Commerce in California. Audience and media Q&A is expected.
  • 06:50 PM St. Louis Fed President Bullard (FOMC non-voter) speaks: St. Louis Federal Reserve President James Bullard will give a speech on the U.S. economy and monetary policy at the 2017 GWU Alumni Lecture in Economics event hosted by George Washington University in D.C. Audience and media Q&A is expected.

Wednesday, March 1

  • 8:30 AM Personal income, January (GS +0.4%, consensus +0.3%, last +0.3%); Personal spending, January (GS +0.3%, consensus +0.3%, last +0.5%); PCE price index, January (GS +0.47%, consensus +0.5%, last +0.2%); Core PCE price index, January (GS +0.33%, consensus +0.3, last +0.1%); PCE price index (yoy), January (GS +2.0%, consensus +2.0%, last +1.6%); Core PCE price index (yoy), January (GS +1.8%, consensus +1.7%, last +1.7%): Based on details in the PPI and CPI reports, we forecast that the core PCE price index rose +0.33% month-over-month in January, which would be enough for the year-over-year rate to round up to +1.8%. Additionally, we expect that the headline PCE price index increased 0.47% in January, or 2.0% from a year earlier. We expect a 0.4% increase in January personal income and a 0.3% rise in personal spending.
  • 10:00 AM ISM manufacturing, February (GS 57.0, consensus 56.0, last 56.0): Regional manufacturing surveys continued to climb in February, and we expect ISM manufacturing to advance to 57.0 in the February report. The Philly Fed (+19.7pt to 43.3) and Empire (+12.3pt to 18.7) manufacturing sector surveys both strengthened further following encouraging January reports. The Kansas City survey also increased notably (+5pt to 14). Our manufacturing survey tracker—which is scaled to the ISM index—rose to 58.8 in February from 56.4 in January.
  • 10:00 AM Construction spending, January (GS +0.6%, consensus +0.6%, last -0.2%): We expect construction spending to increase 0.6% in January, following a 0.2% decline in December that reflected weaker state and local spending and flat private nonresidential construction activity.
  • 12:30 PM Dallas Fed President Kaplan (FOMC voter) speaks: Dallas Federal Reserve President Robert Kaplan will discuss local and national issues at the Workforce Development Roundtable and Community Luncheon hosted by Paul Quinn College in Dallas, Texas.
  • 02:00 PM Beige Book, March FOMC meeting period: The Fed’s Beige book is a summary of regional economic anecdotes from the 12 Federal Reserve districts. The January Beige Book reported that activity continued to expand across most districts. Manufacturing activity picked up while residential investment was mixed. Additionally, employment conditions continued to improve and wage growth increased a bit. In the March Beige Book, we look for additional anecdotes related to the state of manufacturing activity, price inflation, and wage growth.
  • 04:00 PM Total vehicle sales, February (GS 17.7mn, consensus 17.7mn, last 17.5mn): Domestic vehicle sales, February (GS 14.1mn, consensus 13.6mn, last 13.6mn)
  • 06:00 PM Fed Governor Brainard (FOMC voter) speaks: Federal Reserve Governor Lael Brainard will give a speech on the economic outlook and monetary policy at the “Malcolm Wiener Lecture in International Political Economy” at Harvard University. Audience Q&A is expected.

Thursday, March 2

  • 08:30 AM Initial jobless claims, week ended February 25 (GS 240k, consensus 245k, last 244k); Continuing jobless claims, week ended February 18 (consensus 2,065k, last 2,060k): We expect initial jobless claims to decline 4k to 240k. The ongoing improvement in jobless claims provides additional evidence of underlying improvement in the pace of layoffs, and we also note the year-to-date improvement in several energy-producing states. Accordingly, we expect the pace of layoffs to remain low.
  • 07:00 PM Cleveland Fed President Mester (FOMC non-voter) speaks: Cleveland Federal Reserve President Loretta Mester will participate in a moderated discussion at an event hosted by the Athena Center for Leadership Studies at Barnard College. Audience Q&A is expected.

Friday, March 3

  • 10:00 AM ISM non-manufacturing, February (GS 57.0, consensus 56.5, last 56.5); We expect the ISM non-manufacturing survey to increase 0.5pt to 57.0. Regional non-manufacturing surveys for February have been encouraging and signal moderate expansion in service-sector business activity. Both the Philly Fed’s nonmanufacturing survey (+4.7pt to +38.0), and the NY Fed’s survey (+9.5pt to +14.5, after our seasonal adjustment) strengthened in February. Overall, our nonmanufacturing survey tracker ticked up to 56.5 from 56.2 in January.
  • 10:00 AM Fed Presidents Evans and Lacker speak: Chicago Fed President Charles Evans (FOMC voter) and Richmond Fed President Jeffrey Lacker (FOMC non-voter) will participate in a discussion on inflation expectations and inflation dynamics at the U.S. Monetary Policy Forum hosted by the University of Chicago Booth School of Business in New York.
  • 12:15 PM Fed Governor Powell (FOMC voter) speaks: Federal Reserve Governor Jerome Powell will participate in a discussion roundtable on “Innovation, Technology, and the Payments System” at an event hosted at the Yale Law School on “Blockchain: The Future of Finance and Capital Markets”. Audience Q&A is expected.
  • 12:30 PM Fed Vice Chair Fischer (FOMC voter) speaks: Federal Reserve Vice Chair Stanley Fischer will give a speech on “Fed Monetary Policy Decision Making” at the 2017 Monetary Policy Forum in New York. Audience Q&A is expected.
  • 01:00 PM Fed Chair Yellen (FOMC voter) speaks: Federal Reserve Chair Janet Yellen will give a speech on the economic outlook at the Executives Club of Chicago. Audience Q&A is expected.

Source: DB, GS, BofA

via http://ift.tt/2l4bB4B Tyler Durden

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