EUROPEAN SESSION
In the European session, the main highlight was the UK CPI report. The data came mostly in line with expectations, so it didn’t change anything in terms of market pricing. The BoE is still expected to cut rates at the next meeting.
Looking ahead, we don’t have much on the agenda other than the final French CPI which is not going to change anything for the ECB either, therefore the market reaction will likely be muted.
AMERICAN SESSION
In the American session, we get several US data releases but they are not going to change anything for the Fed. We begin with the US durable goods orders and the housing starts/building permits reports. These will cover December, so they are old news. Then we will get the US industrial production and capacity utilization data for January which is expected to improve slightly.
Lastly, we conclude with the FOMC meeting minutes which is a market-moving release but the initial reactions get almost always faded due to the outdated nature of the data.
In fact, the minutes are a detailed, written record of the FOMC meeting. The Fed Chair shares the views of the committee at the press conference, so the minutes are never surprising. Moreover, the report is released three weeks after the meeting, so by the time it gets released, the content is almost always outdated given the economic data released in the meantime.
The FOMC meeting minutes is generally marked as a high impact event on economic calendars, but it should actually be marked as a low impact release.
CENTRAL BANK SPEAKERS
08:30 GMT/03:30 ET – ECB’s Villeroy (neutral – voter)17:00 GMT/12:00 ET – ECB’s Schnabel (neutral – voter)18:00 GMT/13:00 ET – Fed’s Bowman (dovish – voter)
This article was written by Giuseppe Dellamotta at investinglive.com.