Hello! I hope you guys had a good Christmas and a Happy New Year, refreshed for the trading year. Before your week ahead, here is what you may have missed over the break.
Let's hope this year we can go past the Coronavirus and onto more positive things. Here is your week ahead.
Australia has been able to recover from their second spike of the Coronavirus well. However, they had not entirely eradicated community transmission amid an outbreak in Sydney's northern beaches just before Christmas last year. After a two-week lockdown for New South Wales, citizens anxiously wait on whether they will be released from lockdown. With Australia taking part in one of the longest lockdowns of any nation, many employed citizens during the lockdown have amassed an increase in savings, which "saw a large rise, up 21% as retail stores experienced a full month of trade" in the last quarter. Analysts predict an increase in Retail sales this week ahead.
The United Kingdom has not been able to keep a cap on the Coronavirus. Deaths are set to overwhelm the NHS's hospital beds if the rate of cases continues to rise. At this point, Prime Minister Boris Johnson is betting on the rollout of the vaccine will help dampen the spread of community transmission. Governor Bailey is set to touch on the continued spread and its effect on monetary policy.
A buzzword that I have heard recently – the "reflation" trade. Many analysts predict a strong bounce back in the American economy, enabling the Federal Reserve to kick its foot off the gas a little bit, as the consumer starts to become the backbone of the United States economy once again. The Coronavirus in the United States is in dire shape, with cases touching 300,000 per day, with deaths at 373,000. Analysts predict CPI year over year to stay the same at 1.6%. However, they also expect CPI Month over Month to drop slightly to 0.1%, from 0.2%. Furthermore, Retail Sales is set to rise from -1.1% to -0.2% this week ahead.
With his last speech three weeks citing market-moving comments, it is a reminder that Powell's words still weight it. His market-moving comments about inflation, stating that "you have to be honest with yourself about inflation these days. There are significant disinflationary pressures around the world.." have analysts' eyes on his speech coming later this week ahead.
It is good to be back. Stay safe, and trade safely.