OPEC MEETING (SUN): + is broadly anticipated to maintain its pause on oil output will increase in place for March when eight key members meet on Sunday, after a pointy rebound in costs this month. Delegates informed Reuters there’s little urge for food to vary coverage after climbed by round 8% in January to above USD 70/bbl, supported by provide disruptions slightly than demand. Bloomberg additionally experiences expectations are for coverage to stay unchanged, with delegates saying there is no such thing as a fast want to reply to current geopolitical developments in Venezuela or Iran. Analysts cite diminished output in Kazakhstan—the place JPMorgan expects the Tengiz discipline to stay offline by January, pushing manufacturing effectively under regular ranges—as a key near-term assist for costs. Whereas dangers linked to Venezuela, Iran and broader geopolitical tensions stay in focus, sources say a significant provide shock could be wanted for OPEC+ to revisit its present stance.
CHINA PMI (SAT-WED): China’s January launch run begins with the official NBS Manufacturing and Non-Manufacturing surveys on Saturday (thirty first January), adopted by Caixin Manufacturing on Monday (2nd February) and Caixin Providers on Wednesday (4th February). Consensus factors to a modest carry-over from late-2025 momentum, although analysts warn that Lunar New 12 months timing may add seasonal noise. The official manufacturing PMI is seen edging as much as 50.2 from 50.1, retaining exercise simply in growth, whereas non-manufacturing is anticipated to pick-up to 50.8 from 50.2. Markets are prone to concentrate on whether or not manufacturing stays above the 50 threshold, with any slip again into contraction elevating doubts over December’s restoration. Consideration will even be on sub-indices, the place “new high quality productive forces”—notably high-tech manufacturing comparable to AI, EVs and semiconductors—are anticipated to stay the principle assist. Offsetting this, the property sector remains to be considered as a cloth drag on the composite image into Q1, pointing to uneven momentum regardless of pockets of resilience.
BOJ SOO (MON): The follows the January coverage assembly, at which the central financial institution stored its short-term coverage charge unchanged at 0.75% in an 8-1 vote, with Hajime Takata dissenting in favour of a 25bps charge hike. The BoJ reiterated that it might proceed to lift charges if its financial and worth outlook is realised, whereas upgrading development forecasts for FY25 and FY26 to 0.9% and 1.0%, respectively, reflecting the impression of presidency stimulus. Inflation projections had been largely maintained, other than a modest raise to the FY26 view. At his post-meeting press convention, Governor Ueda mentioned monetary situations stay accommodative and that the results of December’s tightening will take time to filter by the economic system. He flagged the weak JPY as a possible upside threat to costs through import prices, expressed some unease over the tempo of rises in long-term yields, and reaffirmed the central financial institution’s readiness to conduct nimble market operations to handle any irregular strikes. Ueda additionally highlighted April worth developments as an vital enter for future coverage selections, underscoring that policymakers are inserting larger weight on underlying inflation dynamics, that are transferring nearer to, however are usually not but firmly anchored at, the two% goal. The SOO shall be watched for any potential hawkish nuances, though focus could also be tempered by current FX intervention considerations and home political developments.
US ISM MANUFACTURING PMI (MON), ISM SERVICES PMI (WED): As a foundation for comparability, rose to a two-month excessive of 51.9 (prev. 51.8) in January. Manufacturing output development accelerated to a five-month excessive and outpaced providers, although new orders rose solely barely after December’s decline, signalling still-soft underlying demand. Export orders fell on the quickest tempo since final April, inventories of completed items continued to construct, and employment development weakened. Enter prices and manufacturing facility gate costs rose sharply, largely attributed to tariffs and better uncooked materials prices. In the meantime, for the providers sector, S&P International’s flash US Providers PMI enterprise exercise index was unchanged at 52.5 in January. Providers exercise noticed a strong rise in January, however development was unchanged from December’s eight-month low, and it remained under common regardless of increased new enterprise inflows. Export demand weakened sharply, with providers exports falling on the quickest charge since November 2022. Employment development was marginal, backlogs rose primarily in providers, and enter price inflation cooled, permitting providers worth inflation to reasonable amid intensifying competitors. S&P mentioned that “the survey is signalling annualised GDP development of 1.5% for each December and January, and a worryingly subdued charge of recent enterprise development throughout each manufacturing and providers provides additional to indicators that first quarter development may disappoint,” including that “elevated prices, broadly blamed on tariffs, are once more cited as a key driver of upper costs for each items and providers in January, that means inflation and affordability stays a widespread concern amongst companies.”
RBA POLICY ANNOUNCEMENT (TUE): The will maintain its first coverage assembly of 2026, and is anticipated to lift charges for the primary time in additional than two years from the present 3.60%. A current Reuters ballot confirmed 24 of 31 economists surveyed anticipate a 25bps hike to three.85%, whereas seven forecast no change. The RBA stored its money charge unchanged in December for a 3rd straight assembly, as anticipated, in a unanimous choice. The assertion signalled that the central financial institution stays data-dependent, and contained no main surprises; nonetheless, a hawkish tone emerged within the post-meeting press convention. Governor Michele Bullock mentioned it appeared additional charge cuts weren’t wanted, and {that a} lower was not thought-about at that assembly, whereas the board mentioned circumstances below which tightening could be required, despite the fact that a hike was not explicitly debated at that assembly. She mentioned persistent inflation would increase coverage questions, with out placing a timeline on any transfer, and reiterated a meeting-by-meeting method. Bullock additionally mentioned she didn’t see charge cuts within the foreseeable future, including that the outlook was for an prolonged pause or hikes, and flagged inflation and jobs knowledge as key inputs for the February assembly. Current knowledge helps the case for a hike, with all 4 main Australian banks now forecasting a February improve. Employment rebounded in December, rising by 65.2K versus expectations of 30K after a previous fall of 21.3K, whereas the unemployment charge unexpectedly fell to 4.1% from 4.3%, towards forecasts of 4.4%. Month-to-month CPI for December got here in firmer than anticipated at 3.8% versus forecasts of three.6%, whereas headline fourth-quarter CPI matched estimates; however the RBA’s most popular trimmed imply measure exceeded forecasts and remained above the 2-3% goal vary.
EUROZONE INFLATION (WED): For January, obtainable Eurozone knowledge confirmed a marked moderation in Spain’s inflation charge to 2.4% Y/Y from 2.9%, whereas Germany’s edged as much as 2.1% Y/Y from 2.0%, though it’s price noting that January’s collection included a number of modifications to Germany’s HICP that will have influenced the result. Total, the steadiness of dangers factors to the Eurozone HICP ticking up from December’s 1.9% Y/Y studying, doubtlessly again in the direction of the two.1% stage seen in November. Whereas this is able to stay inside a well-known vary, it might be above the ECB’s 1.9% forecast for 2026 as a complete. This provides to the argument, alongside the current power of the Euro, that the ECB’s evaluation of being in a “good place” might not maintain all through 2026 as present market pricing implies, and that, opposite to pricing which suggests round 10bps of easing this 12 months, upside inflation dangers skew the eventual transfer in the direction of a charge hike.
US TREASURY QUARTERLY REFUNDING ANNOUNCEMENT (WED): Barclays expects the Treasury to reaffirm steering to maintain nominal coupon and FRN public sale sizes unchanged for a number of quarters, implying no coupon will increase in 2026. This might create a roughly USD 700bln funding hole, which might largely be met through T-bill issuance, with the Fed absorbing about USD 500bln, leaving manageable personal issuance in 2026 however rising pressures in 2027, the financial institution writes. The Treasury is exploring SOFR-indexed FRNs, having sought vendor suggestions and beforehand consulted on the thought. Barclays says that demand seems sturdy, given development in company SOFR FRNs and cash fund holdings. Barclays believes the market may take up at the very least USD 200bln in first-year issuance, making a 2027 launch believable to assist deal with future funding wants. Elsewhere, merchants shall be watching the 7yr sector; within the Treasury’s Major Supplier Assembly Agenda for Q1, it mentioned that it was contemplating shifting the 7yr notice to a quarterly new-issue cycle with two reopenings, just like the 10yr; this would scale back the variety of 7yr CUSIPs over time, leading to fewer however bigger particular person points. The Treasury requested sellers what results may such a change have on corporations’ capability to make markets and supply liquidity within the Treasury market. NOTE: forward of the Wednesday refunding announcement, the Treasury on Monday will present its financing estimates, giving us a glimpse on what to anticipate from the QRA.
BOE POLICY ANNOUNCEMENT (THU): The is anticipated to maintain its Financial institution Fee unchanged at 3.75% at its February assembly, with a near-unanimous consensus within the newest Reuters ballot pointing to a maintain. Focus shall be on the vote cut up and steering after the MPC was sharply divided in December, voting 5-4 to decrease charges, and amid indicators of firmer exercise, together with the strongest private-sector enterprise development since April 2024 and resilient retail gross sales. Reuters polling exhibits solely a slim majority of economists now anticipate a 25bps lower in March, with confidence in near-term easing having ebbed as inflation stays the best amongst G7 friends, and wage development stays elevated. Pantheon Macroeconomics expects a 6-3 vote to carry coverage, with Alan Taylor, Dave Ramsden and Swati Dhingra seen favouring a 25bps discount, arguing the choice itself is a foregone conclusion, and that steering is prone to proceed signalling a “gradual downward path” for charges, albeit with longer gaps between cuts than seen in 2025. Pantheon additionally expects up to date forecasts to look comparatively hawkish, with inflation projected to stay above goal on the two- and three-year horizons, even because the November Price range measures decrease near-term inflation. “All informed, we expect the market is correct to completely worth just one extra charge lower this 12 months, with an opportunity of hikes beginning early in 2027,” Pantheon mentioned.
ECB POLICY ANNOUNCEMENT (THU): The is anticipated to keep up coverage settings, retaining its deposit charge at 2.00%. December’s assembly reaffirmed a meeting-by-meeting, data-dependent method, with its assertion and the post-meeting press convention with President Christine Lagarde saying that coverage was in a “good place”. Shortly after the assembly, sourced experiences echoed that view, whereas stressing {that a} charge lower remained an possibility if wanted. Since then, officers have largely caught to the “good place” message, with Chief Economist Philip Lane saying there’s “no near-term rate of interest debate,” whereas its markets chief Isabel Schnabel clarified that there could be no change within the “foreseeable future,” after earlier feedback on tightening sparked a hawkish response in Euro belongings. The principle exception was Lithuania’s Gediminas Simkus, who mentioned coverage suits the second and charges are on maintain for now, however past February, the trail is much less clear. Past charges, the Euro’s power since mid-January has been a key speaking level, and is prone to characteristic within the press convention. Merchants will look to Lagarde’s post-meeting presser for clues on the timing and route of the subsequent transfer, although she is unlikely to be forthcoming.
BANXICO POLICY ANNOUNCEMENT (THU): Banxico is anticipated to undertake a cautious stance at its February coverage assembly. Minutes from its December confab level to assist for a pause, with policymakers flagging commerce uncertainty, new import tariffs and better particular taxes as near-term inflation dangers, regardless of viewing their impression as largely non permanent. Core inflation stays above goal, whereas headline inflation has eased. Though December’s 25bps lower to 7.00% was justified by inflation progress, weak development and a robust MXN, a number of argued for a wait-and-see method. Analysts more and more see a maintain as the marginally extra possible end result, because the financial institution assesses whether or not these tax, tariff and wage shocks generate second-round results, earlier than resuming easing.
RBI POLICY ANNOUNCEMENT (FRI): The RBI is anticipated to go away charges unchanged. A current Reuters ballot confirmed 59 of 70 economists anticipate the financial coverage committee to maintain the repurchase charge at 5.25%. The RBI lower the speed by 25bps to five.25% at its December assembly, as anticipated, in a unanimous choice, whereas retaining a impartial stance regardless of dovish dissent from MPC member Ram Singh, who argued for a shift to an accommodative stance. Governor Sanjay Malhotra mentioned the economic system had seen speedy disinflation and described situations as a uncommon “Goldilocks” interval, whereas noting that geopolitical and commerce uncertainties had been weighing on the outlook. He mentioned development was anticipated to melt considerably, coverage house existed to assist momentum, and headline inflation had eased considerably, with the decline turning into extra broad-based, though some main indicators confirmed indicators of weak spot. The language prompt additional coverage motion couldn’t be dominated out, even after cumulative cuts of 125bps final 12 months. Shopper inflation remained subdued in December, with CPI at 1.33% versus expectations of 1.5%, up from 0.71% beforehand. Whereas inflation has rebounded from the file low of 0.25% in October, it stays under the RBI’s 2-6% tolerance band.
(FRI): Current jobs market knowledge has proven stability within the face of different coverage challenges. Within the week that corresponds with the BLS survey window for amassing the roles knowledge, weekly remained low at 210k after revisions; that compares to 224k heading into the December knowledge. In the meantime, persevering with claims eased to 1.827mln within the survey week vs 1.914mln into the December knowledge. “There is no such thing as a proof that layoffs are selecting up. There are corporations which are making an attempt to scale back their headcount, however that is being carried out virtually solely by attrition slightly than outright job cuts,” Santander mentioned, “layoffs on an underlying foundation are roughly regular.”
Wells Fargo expects the January jobs report to go away the labour market image broadly unchanged, with payroll development of round 80k and unemployment regular at 4.4%. It says that hiring could also be briefly boosted by fewer seasonal layoffs. Dangers to unemployment are seen to the upside, nonetheless, whereas benchmark revisions are prone to present final 12 months’s job development was weaker, reinforcing a gradual cooling in labour market assist for incomes and consumption. At this week’s confab, the Fed tweaked its threat characterisation on the labour market, changing “job positive factors have slowed this 12 months, and the unemployment charge has edged up by September,” to “Job positive factors have remained low, and the unemployment charge has proven some indicators of stabilisation,” which analysts mentioned was a optimistic improve to the language.
Nonetheless, Chair Powell mentioned that dangers to employment on each the upside and draw back have diminished however not disappeared, making it laborious to guage whether or not mandate dangers are totally balanced. Merchants will even be watching if there’s any impression of maximum climate situations on the information. Oxford Economics mentioned “We’ve beforehand proven storms that happen throughout the payroll reference interval have traditionally had a larger adverse impact on the web change in nonfarm employment and hours labored as poor climate prevents folks from reaching work,” noting that development payrolls are significantly delicate,” however OxEco provides that “this storm is going on exterior this era, which ought to mute the potential draw back impacts to the January employment report.”
CANADIAN JOBS REPORT (FRI): At its coverage assembly this week, the Financial institution of Canada softened its language across the labour market; in December, it mentioned that the labour market was “displaying some indicators of enchancment,” noting that “strong positive factors” have been seen in employment over the previous three months, and the unemployment charge declined to six.5%, including that weak spot was confined primarily to trade-sensitive sectors, with subdued hiring intentions. In its January assertion, nonetheless, it mentioned that employment has “risen in current months” (eradicating reference to “strong”), and it now describes the unemployment charge now as “elevated at 6.8%,” including that fewer companies plan to rent extra employees. In the end, the BoC held charges for a second consecutive assembly at 2.25%, stating that corporations want time to regulate to US tariffs whereas hiring stays weak, and heightened uncertainty makes the timing and route of the subsequent coverage transfer laborious to foretell.