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In the past week, we witness another blowout earnings report from Facebook (FB), Alphabet Inc. (Google), Amazon COM Inc. (AMZN), Apple Inc. (AAPL), Microsoft Corp. (MSFT), and the list goes on. In the next two weeks, we have more than 2000+ companies reporting earnings, and we will know what is percentage of companies which beats the earning expectation.
In last week’s FOMC Statement the FED repeated the same message they will continue to provide 120 billion liquidity per month ( $80 billion per month of Treasury securities and $40 billion of agency mortgage‑backed securities) until inflation moderately above two percent, and the US economy reach full employment. During the FED press conference on Wednesday, the 28th of April 2021 Chairman Powell said “not time yet” for QE tapering talks.
On the next day, we found out that the USA economy has grown by 6.4% GDP q/q. On the following day, on Friday, we saw another strong economic data, Personal Income m/m grew by 21.00%, Personal Spending m/m bt 4.2%, Chicago PMI at 72.1, and Revised UoM Consumer Sentiment came at 88.3.
On Saturday, during the annual Berkshire Hathaway shareholders meeting, Warren Buffett said, that their businesses are raising their prices because of inflation, adding that the inflation is higher than what many anticipated 6 months ago.
That is why one may conclude, the US economy doesn’t need 120$ billion in liquidity per month from the FED. There are specific pockets from the US economy that need support, but that need to be addressed by targeted policies from the White House and Congress. On the other hand, the FED doesn’t want to stall the momentum in the US economy by removing the liquidity support, risking bigger problems down the row. Also, no one is daring to predict what will the world face next winter, are we going to have enough vaccinated people against COV19 to reach herd immunity in the US, what about the EU and the rest of the world.
The Biden administration and the Democrats are changing their tack tick, and are planning to pass some of the Infrastructure Bill with the support from the Republicans in Senate, and the rest of the Infrastructure Bill will be passed separately without the Republicans. Therefore, looks like an additional stimulus package in the form of Infrastructure Bill is coming, but how much the total will be is still unclear, the minimum is around 600$ billion, which is what the Republicans are willing to support.
The focus for the week ahead is on the following events:
- Canada Markit Manufacturing PMI APR – Monday, May 03, 2021
- US Construction Spending MoM MAR – Monday, May 03, 2021
- US ISM Manufacturing PMI APR – Monday, May 03, 2021
- US ISM Manufacturing New Orders APR – Monday, May 03, 2021
- US ISM Manufacturing Employment APR – Monday, May 03, 2021
- US Fed Chair Powell Speaks – Monday, May 03, 2021
- Australia Balance of Trade MAR – Tuesday, May 04, 2021
- Australia Imports MoM MAR – Tuesday, May 04, 2021
- Australia Exports MoM MAR – Tuesday, May 04, 2021
- Australia RBA Interest Rate Decision – Tuesday, May 04, 2021
- UK BoE Consumer Credit MAR – Tuesday, May 04, 2021
- UK Mortgage Lending MAR – Tuesday, May 04, 2021
- UK Markit/CIPS Manufacturing PMI Final APR – Tuesday, May 04, 2021
- UK Mortgage Approvals MAR – Tuesday, May 04, 2021
- Canada Balance of Trade MAR – Tuesday, May 04, 2021
- Canada Building Permits MoM MAR – Tuesday, May 04, 2021
- Canada Exports MAR – Tuesday, May 04, 2021
- Canada Imports MAR – Tuesday, May 04, 2021
- US Balance of Trade MAR – Tuesday, May 04, 2021
- US Exports MAR – Tuesday, May 04, 2021
- US Imports MAR – Tuesday, May 04, 2021
- US ISM New York Index APR – Tuesday, May 04, 2021
- US Factory Orders MoM MAR – Tuesday, May 04, 2021
- US Factory Orders ex Transportation MAR – Tuesday, May 04, 2021
- New Zealand Employment Change QoQ Q1 – Wednesday, May 05, 2021
- New Zealand Unemployment Rate Q1 – Wednesday, May 05, 2021
- Switzerland Inflation Rate YoY APR – Wednesday, May 05, 2021
- Switzerland Inflation Rate MoM APR – Wednesday, May 05, 2021
- Spain Unemployment Change APR – Wednesday, May 05, 2021
- Spain Markit Services PMI APR – Wednesday, May 05, 2021
- Italy IHS Markit Services PMI APR – Wednesday, May 05, 2021
- Italy IHS Markit Composite PMI APR – Wednesday, May 05, 2021
- US ADP Employment Change APR – Wednesday, May 05, 2021
- US ISM Non-Manufacturing PMI – Wednesday, May 05, 2021
- US ISM Non-Manufacturing Employment APR – Wednesday, May 05, 2021
- US ISM Non-Manufacturing Business Activity APR – Wednesday, May 05, 2021
- Canada BoC Gov Macklem Speech – Thursday, May 06, 2021
- German Factory Orders MoM MAR – Thursday, May 06, 2021
- UK BoE Interest Rate Decision – Thursday, May 06, 2021
- UK BoE Quantitative Easing – Thursday, May 06, 2021
- UK Monetary Policy Report – Thursday, May 06, 2021
- UK MPC Meeting Minutes – Thursday, May 06, 2021
- UK BoE MPC Vote Hike – Thursday, May 06, 2021
- US Initial Jobless Claims 01/MAY – Thursday, May 06, 2021
- Australia Ai Group Services Index APR – Friday, May 07, 2021
- Australia RBA Statement on Monetary Policy – Friday, May 07, 2021
- China Caixin Services PMI APR – Friday, May 07, 2021
- China Balance of Trade APR – Friday, May 07, 2021
- China Exports YoY APR – Friday, May 07, 2021
- China Imports YoY APR – Friday, May 07, 2021
- Switzerland Unemployment Rate APR – Friday, May 07, 2021
- German Balance of Trade MAR – Friday, May 07, 2021
- German Industrial Production MoM MAR – Friday, May 07, 2021
- German Exports MoM s.a MAR – Friday, May 07, 2021
- German Imports MoM s.a MAR – Friday, May 07, 2021
- Frace Industrial Production MoM MAR – Friday, May 07, 2021
- Frace Balance of Trade MAR – Friday, May 07, 2021
- Frace Private Non-Farm Payrolls QoQ Prel Q1 – Friday, May 07, 2021
- Spain Industrial Production YoY MAR – Friday, May 07, 2021
- Italy Retail Sales MoM MAR – Friday, May 07, 2021
- EU ECB President Lagarde Speech – Friday, May 07, 2021
- Canada Employment Change APR – Friday, May 07, 2021
- Canada Full Time Employment Chg APR – Friday, May 07, 2021
- Canada Unemployment Rate APR – Friday, May 07, 2021
- Canada Average Hourly Wages YoY APR – Friday, May 07, 2021
- Canada Ivey PMI s.a APR – Friday, May 07, 2021
- US Non-Farm Payrolls APR – Friday, May 07, 2021
- US Unemployment Rate APR – Friday, May 07, 2021
- US Nonfarm Payrolls Private APR – Friday, May 07, 2021
- US Average Hourly Earnings MoM APR – Friday, May 07, 2021
- US Manufacturing Payrolls APR – Friday, May 07, 2021
