The Week Ahead - 17 - 21 February 2025
These are the Key Macro Events for the upcoming week.
US – On Wednesday we get the minutes of the January FOMC meeting where the Fed paused their easing cycle amidst stalling inflation progress. The minutes are likely to reflect the cautious approach moving forward, and to discuss the various risks to the outlook, particularly the four categories mentioned by Powell in the press conference: tariffs, immigration, fiscal and regulatory policy.
Eurozone – The eurozone composite PMI in February is expected to have edged further into expansionary territory. The services sector is what is driving activity in the eurozone, while we expect some early signs of stabilisation in manufacturing, in part because of increased goods demand in Europe and possibly from frontloading effects in trade resulting from possible US tariffs. However, industrial activity is still at very low levels and not yet expected to return to growth soon.
The Netherlands – The unemployment rate for January is expected to come in at 3.7%, unchanged from the December figure. In the fourth quarter, labour market tightness increased again, with 1.08 vacancies per unemployed. The primary constraint for the business sector remains the shortage of labour. Still, cyclical factors that have exacerbated labour market tightness are easing, meaning that we do expect some increase in the unemployment rate in the coming months.
China – For now, no changes in the 1-year loan prime rate (3.10%) on Thursday and the 1-year medium-term lending facility rate (decision scheduled between 17 and 25 February) are expected. Although we anticipate further policy rate and RRR cuts going forward, the timing thereof is partly impacted by currency and US tariff considerations (with the PBoC recently taking action to stem yuan depreciation pressures versus the US dollar, by setting its daily fixings relatively strong).