22 to 28 April: The glass can become more than half full this week

Investors have a very busy week ahead in terms of data releases and policy events. The economic diary in the US is fully packed with potentially market-moving data, such as the Fed’s preferred inflation gauge, the PCE deflator and the monthly jobs report (including the NFP, unemployment rate and earnings). The market will need to not only digest the two most relevant set of macro indicators in the US, but the Fed will also decide on monetary conditions. We concur with the broad market consensus that the FOMC will keep the Fed funds rate stable. However, the messages delivered by Chair Powell could easily stir markets and induce a shift in the general risk sentiment. And if these were not enough, talks between the US and China will restart in Beijing on Tuesday, where the two parties “will cover trade issues including intellectual property, forced technology transfer, non-tariff barriers, agriculture, services, purchases and enforcement,” according to a statement released by the White House. In conclusion, if headlines from the US-China talks continue to become more constructive, inflation in the US remains benign and the Fed signals staying on put in the context of robust GDP growth, global market sentiment will have every reason to improve.

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