The highlight of those talks will be the face-to-face meeting between President Donald Trump and Chinese President Xi Jinping.
LONDON: Central bankers hand back the spotlight to presidents and prime ministers this week as leaders from the Group of 20 gather for a summit in Japan.
The highlight of those talks will be the face-to-face meeting between President Donald Trump and Chinese President Xi Jinping. That they are meeting at all was enough to send stocks higher last week.
Now there is pressure for the two sides to ensure at the very minimum that their tariff battle doesn’t worsen.
Any hint they’re prepared to get talks back on track toward a deal would be welcome news for a global economy dented by the uncertainty. A truce may also prompt markets to rethink how aggressive the Federal Reserve and fellow central banks still need to be after they last week shifted closer to new stimulus measures.
"The Trump-Xi meeting at the G-20 summit in Japan holds the potential to dramatically reshape the outlook for trade tensions,” said Bloomberg Economics’ Carl Riccadonna, Yelena Shulyatyeva and Eliza Winger. "A rocky outcome would compel the Fed to act sooner.”
Here’s our weekly rundown of other key economic events:
US and Canada
Having made it through one of the most complicated meetings of Fed officials in recent history, Chairman Jerome Powell will speak at a Council on Foreign Relations event in Washington. He will do so as investors seek clues into whether and how soon he will deliver the interest-cuts he last week shifted toward.
Whether Trump continues his attacks on the Fed will also draw attention after Bloomberg reported the president believes he can strip Powell of the chairmanship if he wants to. Other key economic reports include the release of durable goods data on Wednesday and the University of Michigan survey on Friday.
In Canada, Friday sees the publishing of the first snapshot of gross domestic product in the second quarter. On the same day, the Bank of Canada releases its business outlook survey, which will help shape its outlook for rates.
Asia
Central banks in New Zealand and Thailand will meet to set monetary policy on Wednesday although no change in either case is expected in Bloomberg surveys according to the median estimates so far. As Trump and Xi meet, China will release current account data on Friday for the first quarter.
Chinese industrial profit data, which come out on Thursday, are likely to show another decline in May.
Europe, Middle East and Africa
After Mario Draghi pushed his European Central Bank a step closer to restarting stimulus, economic numbers may provide clues as to how worried policy makers should be. German Ifo business confidence on Monday and euro-area economic confidence on Thursday will signal the mood for spending and investment.
The week’s finale on Friday is the all-important flash June inflation data which Bloomberg Economics expects will show the consumer price index rising 1.2%.
Bank of England Governor Mark Carney will have a chance to explain his outlook when he faces a U.K. Parliament Committee on Wednesday. Hungary and the Czech Republic are set to keep interest rates unchanged.
Turkish confidence and capacity utilization data this week will provide an insight into growth momentum in the second quarter, which is widely expected to be worse than the first, when the economy emerged from a contraction. Foreign investors have begun buying the nation’s assets again and capital flow data on Thursday will show whether that trend continued.
Botswana is expected to hold its benchmark rate at 5% on Thursday and into the end of the year, despite the risk of inflation falling below its target range of 3% to 6%.
Latin America
Brazil’s central bank on Tuesday will provide more details about its June 19 decision to keep borrowing costs at an all-time low of 6.5% and condition future cuts on "concrete advances” in the country’s reforms agenda.
Mexico’s central bank will likely hold its key interest rate at a decade high of 8.25% on Thursday despite growing risk of recession, as inflation remains above target and the threat of U.S. tariffs haunts policy makers.
In Argentina, the first signs of economic comeback may emerge on Wednesday when the statistics institute reports activity data for April. President Mauricio Macri desperately needs some good news on the economy as he seeks re-election.- Bloomberg
Limited time offer:
Just RM5 per month.
