The second trading week of January shifts the focus from the labor market to inflation indicators. The primary event will be the release of the US Consumer Price Index (CPI), which is expected to determine whether market expectations for Fed policy easing are justified. Investors will also keep a close watch on central bank rhetoric and the performance of the British economy, which continues to face headwinds.
United States:
● 5:30 p.m. GMT: Speech by FOMC Member Bostic.
● 5:45 p.m. GMT: Speech by FOMC Member Barkin.
Fed officials will offer their first remarks following Friday's NFP report. Their stance on inflation will set the tone ahead of tomorrow's CPI data release.
United Kingdom:
● 9:00 a.m. GMT: Speech by Bank of England Governor Bailey. The market is awaiting assessments of the Labour Party's fiscal policy and the outlook for interest rates in 2026. Any dovish signals will likely increase pressure on the pound.
United States:
● 1:30 p.m. GMT: Consumer Price Index (CPI) (Month-over-Month) (December). (Forecast: 0.3%; Previous figure: 0.3%)..
● 1:30 p.m. GMT: Consumer Price Index (CPI) (Year-over-Year) (December). (Forecast: 2.7%; Previous figure: 2.7%). This is a key report. Stabilization at 2.7% is already priced into the market. That being said, any data exceeding the forecast could trigger a rise in bond yields and the USD.
● 1:30 p.m. GMT: Core Consumer Price Index (CPI) (Month-over-Month) (December). (Forecast: 0.3%; Previous figure: 0.2%).
● 3:00 p.m. GMT: New Home Sales (October). (Forecast: 715K; Previous figure: 800K). The projected decline may indicate a slowdown in the housing sector due to elevated interest rates.
United States:
● 1:30 p.m. GMT: Producer Price Index (PPI) (Month-over-Month) (November). (Previous figure: 0.3%). This serves as a leading indicator for consumer inflation.
● 1:30 p.m. GMT: Retail Sales (Month-over-Month) (November). (Forecast: 0.4%; Previous figure: 0.0%). A recovery in consumer activity is expected. Strong figures would support the soft-landing narrative for the economy.
● 1:30 p.m. GMT: Core Retail Sales (MoM) (Nov). (Forecast: 0.4%; Previous figure: 0.4%).
● 3:00 p.m. GMT: Existing Home Sales (Dec). (Forecast: 4.24M; Previous figure: 4.13M).
● 3:30 p.m. GMT: Crude Oil Inventories. (Previous figure: -3.832M).
United Kingdom:
● 7:00 a.m. GMT: GDP (Month-over-Month) (November). (Forecast: 0.0%; Previous figure: -0.1%). The British economy remains on the verge of recession. A lack of growth would confirm the pound's current weakness.
Eurozone:
● 9:00 a.m. GMT: ECB Monthly Report. This document will provide insight into the regulator's perspective on the persistence of inflation within the services sector.
United States:
● 1:30 p.m. GMT: Philadelphia Fed Manufacturing Index (January). (Forecast: -2.9; Previous figure: -8.8).
● 1:30 p.m. GMT: Initial Jobless Claims. (Forecast: 210K; Previous figure: 208K).
● 1:45 p.m. GMT: Manufacturing PMI (January). A leading indicator of the business cycle for the start of the year.
Germany:
● 7:00 p.m. GMT: Consumer Price Index (CPI) (Month-over-Month) (December). (Forecast: 0.0%; Previous figure: 0.0%). Final data for the Eurozone's largest economy.
Canada:
● 1:15 p.m. GMT: Housing Starts (December). (Forecast: 255.0K; Previous figure: 254.1K). This will be a significant trigger for CAD-related pairs.
● GBP weakness: The pound remains under pressure due to stagnant GDP growth and fiscal risks. Governor Bailey’s speech on Tuesday and the GDP data on Thursday could act as catalysts for a test of the support level.
● Oil sector: On Wednesday, US inventory data and retail sales figures may provide a new impulse for WTI. Resilient consumer demand reflected in retail sales is generally positive for energy consumption.
● Weekly technical outlook: Given the high concentration of economic events mid-week, we recommend locking in a portion of profits by Thursday evening. Friday is expected to be relatively quiet, and we may witness corrections to the week's major moves.
We wish you a successful and profitable trading week!
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