© Reuters. FILE PHOTO: An eagle tops the Federal Reserve building’s facade in Washington, July 31, 2013. REUTERS/Jonathan Ernst
A deluge of data from across major economies comes at a pivotal moment in the debate over whether central banks are jacking up interest rates into a potentially sharp global growth slowdown.
And with jittery investors dumping risk assets en masse, what comes next after a crypto-currency rout is also in focus.
Here’s your week ahead in markets from Ira Iosebashvili in New York, Tom Westbrook in Singapore, Elizabeth Howcroft, Sujata Rao and Karin Strohecker in London.
1/ HARD OR SOFT LANDING?
The Federal Reserve is all but certain to hike interest rates by 50 basis points at upcoming meetings. Upcoming data should show whether hefty tightening will bring a hard or soft landing for the economy.
Forecasts for Tuesday’s U.S. retail sales data predict a 0.7% rise in April after a 0.5% monthly increase in March. Signs of how much inflation, which shows only the slightest hints of moderating, is pinching consumers may also be evident in Tuesday’s earnings reports from Walmart (NYSE:), Home Depot (NYSE:) and Macy’s.
Friday’s existing home sales data could show just how quickly rising mortgage rates are cooling the housing market.
The Fed’s determination to contain inflation has fuelled hard landing worries. The is set for its worst year since 2008 — any signs the economy is weathering higher rates would be welcome relief.
U.S. retail sales https://fingfx.thomsonreuters.com/gfx/mkt/dwvkryxdypm/Pasted%20image%201652306123735.png
Cryptocurrency aficionados and observers alike will be watching for the fallout of a spectacular price collapse.
was on track on Friday for a double-digit weekly drop, and headed for a record losing streak. Other cryptocurrencies have also slid with investors shunning risk assets as central banks get aggressive on inflation.
Whether so-called stablecoins can maintain their dollar pegs as investor confidence plummets is key. The algorithmic stablecoin TerraUSD broke its peg and has plunged to as low as 30 cents, as its complex balancing mechanism involving another free-floating token stopped working.
Others such as , and Binance USD are confident they will be spared TerraUSD’s fate because their cryptocurrencies are backed by reserves of dollar-based assets. Those reserves may come under increasing scrutiny as investors assess whether those coins can handle a wave of redemptions.
Bitcoin wipes out 2021 gains https://fingfx.thomsonreuters.com/gfx/mkt/znvnemwgapl/Bitcoin.png
3/ TAKING ASIA’S PULSE
A data pulse across Asia could re-calibrate the outlook for regional assets. Japan reports growth, trade and inflation data. If they beat expectations, even the world’s most dovish central bank may start considering a more neutral stance — good news for a frail yen.
China reports industrial output, retail sales and house prices, probably all glum. China also fixes benchmark rate