For the first time in over two years, this week, the global business elite is set to assemble at the World Economic Forum in Davos, Switzerland, amid turbulent markets and an uncertain economic outlook.
Last Friday, the S&P 500 briefly crashed into the bear market territory — a 20% drop from recent highs — intraday.
On the economic front, an otherwise dry week of economic data peaks this Friday, where the market is bracing for PCE and Core PCE inflation readings.
On Wednesday, core durable goods orders will draw interest. Also, the German economy will be back in focus with GDP and consumer sentiment to wrap up the week.
On the same day, the FOMC meeting minutes should provide a few surprises following recent Fed Chair Powell’s speeches.
Investors brace for an economic slowdown as signs emerge that inflation is becoming entrenched in pockets of the economy.
A policy-induced economic slowdown is a painful endeavour as record-high inflation has created a multi-layered crisis.
Still, on Wednesday, markets expect the Reserve Bank of New Zealand to raise the Official Cash Rate by another 50 basis points to 2.00% at its meeting.
On the geopolitics front, Russia and Ukraine will remain the area of focus in the week ahead.
Key Economic Events 24/05 – 27/05
Tuesday: April new home sales
Wednesday: April core durable goods orders | FOMC minutes | Weekly crude oil inventories
Thursday: First-quarter GDP growth (second estimate) | Initial jobless claims| End of World Economic Forum
Friday: United States Personal Income and Consumption (Apr) | United States Core PCE Price Index (Apr)
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