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Week Ahead Economic Preview: Week of 13 January 2020
The following is an extract from IHS Markit's latest Week Ahead Economic Preview. For the full report (including Special Reports) please click on the link at the bottom of the article.
- US fourth quarter growth indications provided by industrial production and retail sales data
- UK GDP data and Eurozone industrial production releases
- China GDP, production, trade, investment and retail sales updates
The week sees a wealth of key official data releases that will add to our knowledge of how the World's major economies fared in the closing months of 2019.
In the US, there have been mixed signals on the health of manufacturing, with a steep decline in the ISM survey contrasting with a more stable - though still very subdued - picture from the IHS Markit PMI survey. Industrial production numbers will therefore provide important evidence on actual growth trends. Likewise, retail sales data will be eyed for hope that consumer spending continued to provide support the US economy and counteract the manufacturing weakness (see page 3).
In the UK, GDP, retail sales and inflation numbers are expected to show the economy struggling to expand amid weak price pressures late last year. The hope - supported by tentative signs of business sentiment improving since December's decisive general election - is that the economy will now pick up pace again. However, the PMI survey illustrates just how weak the business sector remained at the end of 2019, and recent comments from Bank of England governor Mark Carney have underscored how a swift acceleration in growth is by no means assured.
Similarly, in the Eurozone, industrial production data are expected to add to signs that the region's producers endured a tough end to the year, and will likely bolster speculation of more stimulus (see page 4 for more insights to Europe).
In the Asia-Pacific the focus is on China, where GDP, industrial production, retail sales and investment numbers will reveal whether the pace of economic growth managed to steady after slipping to the lowest since at least 1992 in the third quarter. We expect GDP growth to have picked up marginally in the fourth quarter, but that this revival will be short-lived, with growth edging below 6% in 2020 to continue the longer-term slowdown trend. Regional trade numbers will also help assess trade war impacts (see page 5).
PMI commentary: Chris Williamson
Europe commentary: Ken Wattret
APAC commentary: Rajiv Biswas and Bernard Aw
Recent week ahead economic previews
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Purchasing Managers' Index™ (PMI™) data are compiled by IHS Markit for more than 40 economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies, and are available only via subscription. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment and inventories. The PMI data are used by financial and corporate professionals to better understand where economies and markets are headed, and to uncover opportunities.
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