More US inflation data is in focus this week as markets continue to figure out how far the Federal Reserve will go in raising interest rates. With that in mind, the FOMC minutes will be looked at closely for any signals of intent ahead of the PCE inflation report. There’s also US GDP data, a New Zealand central bank decision and flash PMI surveys to look out for.

Here are the week’s key events:

Monday

Wall Street is closed for Washington’s birthday holiday, which will keep volumes thinner than usual. In Europe, market attention is on Germany with the Buba monthly report and later on the latest Eurozone consumer confidence survey.  

Tuesday

Flash PMI survey data for the Euro area, UK and the US are released, signalling to what extent economic growth is contracting as the year kicks off. Canadian inflation numbers and the latest existing home sales figures from the US will also be eyed. Meanwhile earnings season on Wall Street continues with the big retailers Home Depot and Walmart reporting their holiday quarter sales.

Earnings:  Medtronic (MDT), The Home Depot (HD), Walmart (WMT), Coinbase Global (COIN), Palo Alto Networks (PANW)

Wednesday

New Zealand inflation expectations declined from 31-year high, prompting traders to lower bets for a big interest rate hike from the central bank this week. The Reserve Bank of New Zealand’s hawkishness in November indicated it would consider a jumbo 75bps hike at its February meeting. But with inflation peaking below the central bank’s forecast, it is more likely the central bank will opt for a smaller hike, which has weighed on the kiwi dollar. Minutes from the last FOMC meeting will also be published.

Earnings: Fiverr International (FVRR), Etsy (ETSY), Lucid Group (LCID), Nvidia (NVDA), Teladoc Health (TDOC), Unity Software (U), Virgin Galactic (SPCE)

Thursday

Final Eurozone inflation numbers are due alongside German import price data. But the main event comes from the US with second reading of Q4 GDP growth. Weekly unemployment claims are published at the same time. Later on, attention shifts to Japan’s national and Tokyo core inflation readings as market participants continue to assess whether the Bank of Japan is moving any nearer to ending its yield curve control policy.

Earnings:  Alibaba Group (BABA), Keurig Dr Pepper (KDP), Moderna (MRNA), Block (SQ), Intuit (INTU)

Friday

A key Fed inflation measure is due – the personal consumption expenditures excluding food and energy increased 4.4% in December from a year before, down from the 4.7% reading in November. The core PCE index is the Fed’s preferred measure of inflation and will be watched closely for further signs of disinflation. Market watchers will pay particularly close attention to services inflation, which is regarded as stickier than goods inflation. A month ago the data showed goods inflation rose 4.6% in December, down from 6.1% in November, while services inflation was steady at 5.2%.