U.S., China Retail Sales And Production Data, Plus U.K. Inflation And Jobs

 | May 13, 2022 08:06

h2 US, China retail sales and production data, plus UK inflation and jobs

The week ahead finds a busy economic calendar alongside a series of Fed appearances which remain in focus given uncertainties over the pace of monetary policy tightening. Both US and China will update retail sales and industrial production figures for April, providing insights into second quarter GDP performances. In Europe, eurozone Q1 GDP and inflation numbers will be due. Meanwhile, UK inflation and labour market data will be released to add clues as to the challenges facing the Bank of England. GDP data releases from Japan, Thailand, and Singapore are also lined up for the week.

Market sentiment remains weak into mid-May amid concerns over inflation, interest rates and economic growth outlooks. According to the latest S&P Global Investment Manager Index, investors remained risk averse in early May, citing monetary policy and geopolitics as the biggest drags on US equity performance. Following the latest Q1 earnings season, US equity investors also further downgraded their corporate earnings expectations for Q2, speaking to both the sensitivity of earnings to interest rates and the worries over demand destruction as a result of higher inflationary pressures and ongoing global developments. As such, official April data due from the US and China - including retail sales and industrial production - will be keenly watched in the week ahead before we get May flash PMI figures from major developed economies in the following week.

Meanwhile, UK inflation and labour market data for April will be released in the coming week for a check on whether inflationary pressures further worsened, as indicated by PMI data. Also, watch out for UK retail sales and consumer sentiment data to gauge the degree to which households are being squeezed by the cost-of-living crisis. This comes after the Bank of England raised rates once again at its May meeting.

Looking back into Q1 performance, a series of GDP data will also be due from the eurozone, Japan, Thailand and Singapore, with the focus on Japan's data for indications of the extent to which GDP likely contracted in the first quarter.

h2 Global economy dependent on consumer services/h2

Our special report featuring the latest detailed sector PMI data shows the global economy being driven by a rebound in spending on consumer services. Having been hit especially hard during the pandemic prior to vaccine availability, consumers in April were spending at one of the fastest rates seen over the past decade as worries over the Omicron wave eased in most major economies.