While much digital ink has been spilled on the Supreme Court's striking down of Trump's IEEPA tariffs and the consequences of this decision (see "Full Analysis Of The Supreme Court IEEPA Decision: How It Impacts The Economy, Policy And Markets"), a lot more is on deck for this week when we will also have more geopolitical headlines to contend with, as the latest round of US-Iran talks is expected in Geneva on Thursday. The talks come amid a recent buildup of US forces in the region and yesterday the New York Times was the latest outlet to report that Trump is considering an initial targeted strike against Iran in the coming days, which could be followed by a larger attack if Iran does not give in to US nuclear demands. Other highlights for the week ahead include theState of the Union addressin the US (late tomorrow), US PPI and preliminary CPIs in Europe (both Friday). In earnings, the focus will be onNvidia, Salesforce(both Wednesday) andHome Depot(tomorrow). Nvidia’s earnings could be the most important of these but expect lots of headlines from the State of the Union speech.
Friday’sUS PPI release- where headline and core inflation are both forecast at 0.3% - will matter less in isolation than for its implications for the core PCE deflator. While January CPI surprised to the downside,the implications for core PCE continue to appear less favorable, with DB economists currently looking for a 0.4% monthly increase.Depending on the strength of key PPI components such as medical services, airfares, and portfolio management fees, a 0.5% increase in January core PCE cannot be ruled out, which would lift the year-over-year rate to around 3.1%. So an important release, especially in the sub-components.
There is a fair degree of Fed speak this week, with Waller (today and tomorrow) a highlight given he dissented in favor of a 25bps cut in January due to concerns over the labor market. However, we’ve subsequently seen a firm January jobs report and a firm December core PCE print, so will he shift his stance a bit? See the day-by-day week ahead at the end as usual for the rest of the Fed speakers and the key global data.
Elsewhere in the world, we have the German Ifo today and the preliminary European February CPI prints including for countries such as Germany, France and Spain, among others, on Friday. There will also be economic sentiment measures for key economies including consumer confidence in the UK, Germany and France, as well as the ECB’s consumer expectations survey due Friday.
Over in Asia, it’s a busy week ahead for Japan with key releases including the Tokyo CPI for February and the January industrial production both due on Friday. Our Chief Japan Economist expects core CPI inflation (ex. fresh food) of 1.7% YoY (2.0% in January) and core-core CPI inflation (ex. fresh food and energy) of 2.4% (2.4% in January). For industrial production, he sees a robust 4.5% MoM gain. See more in his full week-ahead here. Elsewhere, inflation will also be in focus in Australia and our economists expect a -0.2% MoM headline print and a 0.24% MoM trimmed mean print.
Other than Nvidia on Wednesday, other tech firms reporting include Salesforce, Intuit, Snowflake and CoreWeave. Amongst US consumer firms, the focus will be on Home Depot, TJX and Lowe’s. Over in Europe, there will be results from HSBC and Allianz in financials as well as other large firms such as Deutsche Telekom, Schneider Electric, Iberdrola and Rolls-Royce.
Courtesy of DB, here is a day-by-day calendar of events
Finally, looking at just the US, Goldman writes that the key economic data release this week is the PPI report on Friday. There are several speaking engagements with Fed officials this week, including events with Governors Waller, Cook, and Bowman.
Source: ZeroHedge News
