Previewing Next Week's Main Events

Curious what the investing world will focus on next week? Here is a recap courtesy of Goldman Sachs, though for those who want the punchline now, just fast forward to Thursday when get Spain and French bond auctions. In the meantime just ignore all the intraday trading halts of Intesa, UniCredit And Banco Popolare. The rest is just the supporting cast.

For the week ahead, we are focused on retail sales, government bond auctions in Spain and France, and central bank meetings in Chile, India, the Philippines, and Sweden.

Monday Apr 16

India WPI (Mar) We expect March WPI inflation at 6.7% yoy, essentially in line with consensus but lower than the 7.0% yoy in February on strong favorable base effects from last year. Primary articles inflation, which led the rise in February WPI and double-digit fuel inflation are expected to keep the headline reading from declining too low. The highlight is core WPI, which is expected to decline further to close to 5% yoy.

US Retail Sales (Mar) We forecast that retail sales increased strongly in March, despite a decline in vehicle sales during the month. We forecast a rise of 0.6% mom, above consensus (0.4% mom). Chain-store sales results were solid and warm weather was probably still a modest positive.

US Long-Term TIC Data (Feb)

Tuesday Apr 17

India Central Bank Meeting We expect the Reserve Bank of India to cut repo rates by 25 bp in its Annual Monetary Policy Meeting, in line with consensus. We do not expect the language to be very dovish, as the Reserve Bank of India mentions risks from suppressed inflation. We continue to expect 125 bp of rate cuts in 2012.

Chile Central Bank Meeting Consensus expects the central bank to stay on hold.

US Housing Starts (Mar) Housing starts likely rebounded in March after declining in February. The sharp drop in single-family starts last month seemed at odds with improving permits and better survey-based data, and should partly reverse. We forecast a rise of 5.0% mom, above consensus of 1.0%.

US Industrial Production (Mar) We are in line with consensus, looking for a reading of 0.3% mom after a flat reading in February.

Wednesday Apr 18

Malaysia CPI (Mar) We expect inflation to come in at 2.1 % yoy for March, in line with consensus. Previously, CPI inflation came in at 2.2% yoy.

Turkey Central Bank Meeting Consensus expects the central bank to stay on hold.

Sweden Central Bank Meeting Consensus sees the Riksbank on hold, as do we. We expect the Riksbank to be on hold for the rest of the year, before hiking rates in Q2 2013. While we see some downside risk in the short run (from European sovereign tensions), the Riksbank will likely also remain concerned about the build-up of domestic household debt.

Thursday Apr 19

Philippines Central Bank Meeting We expect Bangko Sentral ng Pilipinas to hold at 6.00% for the policy repo rate and 4.00% for the reverse repo rate, in line with consensus. Pressure from higher fuel prices has raised the hurdle for further rate cuts after 50 bp cuts so far since the last easing cycle ended in July 2009.

Spain and France Bond Auctions

US Initial Claims (Apr 14) Consensus is looking for a reading of 370k after a reading of 380k last week.

US Philadelphia Fed Survey (Apr) The Philadelphia Fed’s business activity index will provide an early indication of manufacturing sector momentum for April. We expect a slight decline to +10.0 from +12.5. Consensus expects +12.0.

Friday Apr 20

Germany IFO (Apr) Consensus expects a reading of 109.5, down slightly from 109.8 in March.


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