Macroeconomics: The Day Ahead for 20 April

  • Central bank speakers out in force ahead of policy meetings; light data schedule has German PPI, Japan Trade, France Business Confidence and NZ CPI to digest; ahead lie Eurozone Consumer Confidence, Taiwan Export Orders and US jobless claims, Philly Fed and Existing Home Sales; CATL the highlight on light day for earnings; France, Spain & US debt sales
  • Weak federal tax receipts fuelling concern over earlier deadline to raise US ‘debt ceiling’
  • US Initial Claims seen little changed at higher levels; labour market less tight but labour demand still robust
  • US Philly Fed Manufacturing: further dead cat bounce from February cyclical low seen, NY Fed surge imparts some upside risks, but correlation very poor
  • US Existing Home Sales: modest mean reversion seen after February jump


The ECB’s March minutes and a deluge of central bank speakers are likely to dominate on a relatively light day for statistics and indeed corporate earnings. There are Japan’s Trade (exports rebounded, but fell to China), German PPI (better than expected) and French Business Confidence (weaker than forecast) to digest, with Taiwan’s Export Orders, provisional Eurozone Consumer Confidence, US weekly jobless claims, Philly Fed Manufacturing survey and Existing Home Sales ahead. Lagarde and Schnabel lead the run of ECB speakers, while Waller and Bowman head the run of Fed speakers, as next week brings the pre-FOMC meeting purdah period. There are govt debt auctions in France, Spain and the US, while a modest run of earnings features China’s CATL and Tinto’s Q1 production update, while the US look to DR Horton, Nucor, Seagate and Union Pacific. In the background, markets will continue to fret over the US debt ceiling, with anecdotal reports suggesting that Federal tax receipts in the peak month of April were weak, and thus implying that the so-called ‘X-date’ when the US would go into default may be as early as the first week of June, considerably earlier than prior estimates of July as the deadline to either raise the ‘debt ceiling’ or extend its suspension. This along with central bank rate concerns, and the US Q1 earnings season, which have seen quite a lot of earnings/revenue beats, but still confirm an earnings recession, continue to be front and centre for markets, and underline a still very uncertain outlook.

 ** U.S.A. – Initial Claims, Philly Fed Manufacturing & Existing Home Sales **

There has been a gradual upward creep in Initial Claims since February, with today’s reading seen fractionally higher at 240K, hardly indicative of a sharp drop in labour demand, but certainly implying that it is less tight than at the start of the year, and still modest by comparison with the rise in layoffs. There will be particular interest in the Philly Fed Manufacturing, after the huge rebound in the NY Fed survey, even though the two surveys are very poorly correlated, a slight recovery from February’s cyclical low of -24.3 and March’s -23.2 to -19.3 is expected, with a close eye likely to be kept on the 6-mth outlook, after it slid to a 6-mth low of -8.0 in March. After an unexpected sharp 14.5% m/m jump to 4.58 Mln in February (the largest m/m gain since July 2020), Existing Home Sales are seen slipping 1.8% m/m to 4.50 Mln SAAR.

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