Key Events: Tariff Fallout Set to Continue Driving Price Action
- By Macro Hive
Key Events
G10
In the US, there is…
- Retail Sales – Wednesday. Consensus expects a big jump in the headline number to 1.4% MoM from 0.2% in February, but this is likely to reflect tariff frontrunning rather than underlying demand strength.
In the Eurozone and UK, the main events will be:
- UK labour market – Tuesday. Labour market data is unlikely to provide a dovish push for the BoE, with wages expected to stay elevated and the unemployment rate at 4.4%.
- UK CPI – Wednesday. Inflation measures are expected to improve YoY, with headline likely to print in line with BoE forecasts. Services inflation is expected to be weaker than the BoE had forecasted for March.
Elsewhere in G10:
- New Zealand Q1 CPI – Wednesday. While consensus headline expectations sit below RBNZ expectations, non-tradables are in line (+0.9% QoQ).
- Australia labour force survey – Thursday. Employment is expected to rebound through March with the unemployment rate edging higher. The biggest (negative) shock is likely to come in April.
EM
- China March Export – Monday. The 20% fentanyl tariff increase took effect in March. However, HF container throughput data and the export order PMI suggest a recovery in export growth to approximately 4%.
- China March Home Prices – Wednesday. HF data indicates a bigger MoM price decline in existing homes than in February, it would suggest a weakening housing recovery in Q1.
- China March GDP – Wednesday. January-February supply and demand growth numbers indicate the Q1 growth rate surpassed last year’s 5%. March data also suggests improving external demand and industry production.
Central Banks in Action
- Fed Chair Powell – Wednesday. Powell could say both that the Fed is focused on maintaining long-term inflation expectations and that economic weaknesses could reduce the second-round impact of tariffs. He will likely also say a few soothing things about market functioning and the Fed’s readiness to support this.
- ECB to cut 25bps – Thursday. Guidance is likely to remain ‘data dependent’ with decisions coming ‘meeting-by-meeting’, though not everyone supports further easing – Holzmann does not see the reason to cut currently.
Markets to Watch
- USD will remain under pressure as tariff negotiations get underway. We added to our short position this week.
Political Events to Watch
- Akazawa in US – Thursday. Negotiations between the US and Japan are yet to begin. Akazawa is in the US on Thursday aiming to get concessions from the US. Trump is likely to push back on defense spending.
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