The Weekly Wrap – Russia’s invasion overshadows economic data


Outside the United States

The private sector PMI and consumer confidence figures caught the eye earlier this week. While consumer confidence weakened in February, private sector activity picked up. According to preliminary figures, the all-important services PMI fell from 51.2 to 56.7.

In the 2n/a mid-week, fourth-quarter GDP, unemployment insurance claims, inflation, personal spending and core durable goods were in focus.

Unemployment insurance claims and GDP figures were positive for the market. Friday’s statistics were mixed, however.

Core durable goods rose 0.7% as personal spending jumped 2.1% in January. Inflationary pressures intensified, with the Core PCE price index rising 5.2% year-on-year in January. This is an increase from 4.9% in December.

In the week ending 25and In February, the Dollar Spot Index rose 0.55% to end the week at 96.615. Over the past week, the index rose 0.02% to 96.106.

Outside the UK

Preliminary private sector PMIs were key for the week. The statistics were positive for the British pound. According to preliminary figures, the UK services PMI fell from 54.1 to 60.8. Manufacturing sector activity remained stable, supporting a rise in the composite index from 54.2 to 60.2.

During the week, the pound slipped 1.14% to end the week at $1.3409. The previous week, the pound rose 0.18% to $1.3589.

The FTSE100 ended the week down 2.24%, after losing 1.92% from the previous week.

Outside the euro area

It was a busy week for the EUR.

At the start of the week, private sector PMI figures for France, Germany and the Eurozone were in focus. The numbers were positive, with the Eurozone composite PMI dropping from 52.3 to 55.8.

Mid-week German business and consumer sentiment data showed mixed results ahead of upward revisions to fourth-quarter GDP figures. Germany’s IFO business climate index rose from 96.0 to 98.9, while the GfK consumer sentiment indicator fell from -6.7 to -8.1.

In the 4and quarter, the German economy contracted by 0.3%, compared to 1st estimate a contraction of 0.7%.

Other statistics included inflation figures which took a back seat as markets reacted to updates on the Russian invasion of Ukraine.

For the week, the euro fell 0.72% to $1.1268. The previous week, the euro fell 0.25% to $1.1322.

The DAX slid 5.56%, with the CAC40 and EuroStoxx600 ending the week down 3.70% and 3.42%, respectively.

For the loon

There were no important statistics for the markets to consider, leaving the loonie in the hands of market risk sentiment.

In the week ending 25and In February, the Loonie rose 0.19% to C$1.2713 against the greenback. The previous week, the Loonie fell 0.12% to C$1.2752.

Elsewhere

It was a bullish week for the Australian Dollar and the Kiwi Dollar.

The Australian dollar rose 1.25% to $0.0.7226, with the Kiwi dollar recovering 1.38% to end the week at $0.6743.

For the Australian dollar

Wage growth was the main area of ​​focus for the week, with wages rising 0.7% in the fourth quarter. In the previous quarter, wages had increased by 0.6%.

Other statistics include construction work carried out and new private CAPEX figures which had a moderate impact on the Australian dollar.

For the kiwi dollar

The RBNZ was in action mid-week, lifting the cash rate by 25 basis points to 1.0%. This was in line with market expectations.

At the end of the week, retail sales and trade data showed mixed results. Retail sales rebounded in the 4and quarter, while New Zealand’s trade deficit widened in January.

The key was the rebound in retail sales which supported the Kiwi dollar over the weekend.

For the Japanese yen

Preliminary February private sector PMI and February inflation figures were the main statistics of the week.

A sharper contraction in the services sector and a slowdown in activity in the manufacturing sector disappointed. The services PMI fell from 47.6 to 42.7 in February.

On Friday, inflation in Tokyo failed to move the dial. Tokyo’s core annual inflation rate fell from 0.2% to 0.5% in February.

The Japanese yen fell 0.11% to end the week at ¥115.550 against the dollar. The previous week, the yen ended the week down 0.14% at ¥115.420.

Outside of China

There were no statistics for the markets to consider in the week.

In the week ending 25and In February, the Chinese yuan rose 0.58% to CNY 6.3175. In the previous week, the yuan ended the week up 0.46% at CNY 6.3256.

The Hang Seng index ended the week down 8.59%, with the CSI300 dropping 0.61%.

Previous Russia Heads for Kyiv, Stocks Rebound, Economic Data Deluge
Next Gallagher discusses new book on overhauling the global economic system