✔️ Press conference by Fed chairman Jerome Powell;
✔️ Inflation data from Germany and labour market data from the US on display;
✔️ American consumer confidence and consumer expectations to end the week.
After many important economic and business figures last week, investors can expect an uneventful trading week. Although Fed chairman Powell appears in front of the cameras again on Tuesday, hardly any new momentum is expected. At the end of the week, the focus is on the preliminary release of the latest inflation (CPI) figures for Germany and the release of new figures on initial unemployment claims in the US. Finally, the University of Michigan publishes consumer expectations and US consumer confidence at the end of the week, on Friday.
Table of Contents
- Press conference by the head of the US Federal Reserve
- Inflation data from Germany and labour market data from the US on display
- US consumer confidence and consumer expectations to end the week
Press conference by the head of the US Federal Reserve
Jerome Powell will appear on Tuesday 7 February appear in front of the camera again. The continued strong jobs market increases the Federal Reserve's options. However, Powell will wait for the latest consumer price data (to be published next week) before taking action. Moreover, developments in China will be closely watched, as rising demand for Chinese commodities could lead to rising US inflation. If, contrary to expectations, Powell indicates he wants to cut interest rates sooner, financial markets may react accordingly.
Inflation data from Germany and labour market data from the US on display
Labour market data from the US and Germany are scheduled for next Thursday. At 8:00 CET, the 'Bundesamt für Statistik' will publish the consumer price index (CPI) for Germany for the month of January. After falling to 8.6 per cent, market experts expect another rise to 9.2 per cent for the month of January. If the analysts are right and inflation in Germany rises above 9 per cent again, it could be seen as a bummer and at the same time a sign that the end of rising consumer prices is not yet in sight. Rising consumer prices could lead to a fall in the European stock market and a decline in the euro against the US dollar.
This is likely to have a negative impact on the bitcoin price. In contrast, if published consumer price indices come in significantly lower than forecast, this could cause a positive price effect, as the euro would have to make up further ground against the US dollar.
At 14:30 (CET) of the same day, the first unemployment claims are published. These are considered the second relevant measure for assessing the US labour market. Compared to the previous week, the forecast was revised upwards by 11,000 initial claims to 194,000. In January, however, the number of reported new claims was consistently lower than expected, which would be in line with labour market data presented last Friday. If, contrary to expectations, the experts' forecast is exceeded and more US citizens claim unemployment benefits, the Fed could consider fiscal easing to counter a renewed deterioration in the labour market situation.
US consumer confidence and consumer expectations to end the week
Friday 10 February 2023: At 16:00 (CET), look out for the final US consumer confidence figures and household consumption expectations for the current January.
In the preliminary report on 13 January, US household consumer confidence continued to rise against analysts' expectations. If the final consumer confidence figures for January also come in within or even above the range of the experts' estimates of 62.9, it would probably also be seen as positive.
If private households remain confident about economic development in 2023 despite the difficult economic outlook, the recently weakened consumer behaviour could also improve again in the coming months.
Should analyst expectations of 64.9 be met or exceeded, the sales trend at Amazon and Apple in the first quarter of 2023 should improve again after the recent weak sales in the last quarter of 2022.
If strong survey data from the University of Michigan again lead to a continued bullish price trend of the S&P500 and Nasdaq, investors in the cryptocurrency sector will have to wait and see whether prices of Bitcoin, Ethereum (ETH) and Co. will resume their price rally from the beginning of this year after taking a breather in the past week.
On the other hand, if consumer confidence and consumer behaviour forecasts fall significantly short of expectations, a price consolidation in the crypto market, cannot be ruled out. Since the beginning of the year, all economic data has been interpreted rather bullish by the market. Whether this trend can hold and whether both "good news" and "bad news" will continue to be ignored by market participants is likely to be put to the test again by the final data from the University of Michigan for the trading month of January.