Investors expect news on global financial stress and policy rhetoric
WEEKLY MARKET COMMENTARY |
Global investors would do well to brace themselves for likely another bout of volatility in asset markets and policy rhetoric this week. Between the trouble brewing in the European financial space and the ongoing problems in China, which has observed a startling decline in foreign currency reserves as it attempts to defend the value of the yuan, investors are likely to see safe haven and moves toward further repatriation of dollar denominated positions to cover margin calls at home this week. Euro area gross domestic product data will be published on Friday with market consensus expecting a 0.3 percent quarter over quarter growth rate.
The week in the U.S. will feature Janet Yellen’s semi-annual testimony on the economy and monetary policy before Congress and the release of the January advance retail sales data on Friday. In addition to Yellen’s testimony, New York Fed President William Dudley will speak on the economy Wednesday and answer questions from the press on Friday regarding household borrowing and debt. The U.S. Treasury will issue $24 billion in three-year notes on Tuesday, $23 billion in 10-year notes on Wednesday and $15 billion in 30-year notes on Friday.