Week 17 Exness economic calendar report: Trade wars, PMIs, and central bank whispers

As traders return from the Easter weekend, Week 17 promises to deliver significant market-moving events amid escalating global trade tensions. With markets still digesting the implications of renewed tariff threats between major economies, this week's economic calendar features a potent mix of central bank decisions, manufacturing data, and inflation readings that could dramatically shift market sentiment.

The shortened trading week begins with lower liquidity as Easter Monday keeps many European markets closed, but don't be fooled by the quiet start—Wednesday's barrage of PMI releases across major economies stands as the week's main event, with whispers of disappointing numbers circulating among institutional traders. Meanwhile, the People's Bank of China has already set the tone by maintaining its benchmark rates despite mounting pressure for stimulus, and rumors of Tokyo inflation data potentially forcing the Bank of Japan's hand on further rate hikes are gaining traction.

Let's dive into what promises to be a week where preparation meets opportunity for the savvy trader.

Monday: China holds steady amid trade war rumblings

The People's Bank of China kept its benchmark lending rates unchanged at 3.10% this morning, marking the sixth consecutive month of steady policy despite growing expectations for stimulus measures. This decision comes against the backdrop of renewed trade tensions that have sent ripples through global markets.

According to sources close to Beijing policymakers, the PBOC is walking a tightrope between supporting growth and defending the yuan, which has come under pressure following recent tariff announcements. While the official stance maintains confidence in China's economic resilience, whispers from trading desks in Shanghai suggest authorities are increasingly concerned about capital outflows and may be preparing a targeted stimulus package for announcement in early May.

"The PBOC is keeping its powder dry," notes a senior trader at a major Asian investment bank who requested anonymity. "There's growing belief among institutional investors that Chinese authorities are waiting to see how trade negotiations develop before deploying their full arsenal of monetary tools."

The decision has immediate implications for the offshore yuan (USDCNH), which initially weakened on the news before stabilizing. Chinese equities listed in Hong Kong and the United States will likely remain volatile as markets digest both the rate decision and ongoing trade rhetoric.

Wednesday: PMI day – The main event

The spotlight shifts dramatically to Wednesday when flash PMI readings for Germany, the Eurozone, the UK, and the United States hit the wires in rapid succession. These preliminary April readings will provide the first comprehensive look at how businesses are responding to the escalating trade tensions and recent central bank policies.

Market expectations are cautiously pessimistic. The Eurozone services PMI is forecast at 50.4, with Germany and France expected to record 50.3 and 47.6, respectively. However, unconfirmed reports from several European trading desks suggest the actual numbers could disappoint, particularly in the manufacturing sector where supply chain disruptions from renewed trade tensions are beginning to bite.

"We're hearing that several large German manufacturers have already begun delaying capital expenditure decisions," revealed a Frankfurt-based economist who advises several hedge funds. "The official forecasts haven't fully captured this recent shift in sentiment."

For the UK, where the manufacturing sector has shown signs of stabilization with the previous PMI rising to 44.9, market participants will be watching closely for confirmation of this trend. Any reversal could put significant pressure on the pound, which has been one of the better-performing G10 currencies in recent weeks.

In the United States, the manufacturing PMI is expected to hold above the crucial 50 mark, but rumors of inventory buildups ahead of potential tariff implementations could be artificially inflating the numbers. Several Wall Street analysts have privately expressed concerns that the underlying details of the report may reveal a less robust picture than the headline figure suggests.

Thursday: Tokyo CPI – Is the Bank of Japan about to surprise markets?

The Tokyo Consumer Price Index, released Thursday night, serves as a leading indicator for nationwide inflation trends in Japan. Recent data showed Tokyo's Core CPI rising from 2.2% to 2.4%, and market chatter suggests April's reading could push even higher.

What makes this particularly interesting is the timing. With inflation persistently above the Bank of Japan's 2% target, speculation is mounting that the BOJ might be forced into a more aggressive tightening stance than markets currently anticipate. Sources familiar with the BOJ's internal discussions suggest Governor Ueda is increasingly concerned about the yen's weakness and its inflationary impact.

"There's a growing faction within the BOJ that believes they're falling behind the curve," confided a Tokyo-based strategist with close ties to the central bank. "If Tokyo CPI comes in hot, it could accelerate their tightening timeline significantly."

The implications for yen pairs (USDJPY, EURJPY, GBPJPY) could be substantial, with the potential for sharp moves if the data surprises to the upside.

Friday: UK Retail Sales – Consumer resilience under the microscope

The week concludes with UK retail sales data, which has recently defied expectations. March figures showed a 0.9% increase on a like-for-like basis, outpacing forecasts of 0.5%. However, the sustainability of this consumer resilience is increasingly questioned as tax changes implemented in April begin to bite.

Market insiders point to private consumption data suggesting a significant pullback in discretionary spending in early April. "The March numbers benefited from Easter shopping, but our credit card transaction data shows a marked slowdown in the first two weeks of April," revealed a consumer analyst at a major British bank.

With business rates for high street shops set to increase dramatically from an average of £3,589 to £8,613, retailers are bracing for challenging conditions. This could have significant implications for the FTSE 100 and the British pound, particularly if the data confirms fears of weakening consumer demand.

Market implications: Assets in the crosshairs

currency pairs to watch

The complex interplay of economic data and central bank expectations puts several currency pairs in the spotlight:

EURUSD stands at a critical juncture, with Wednesday's PMI data likely to determine its near-term direction. The pair has been consolidating in a tight range, but disappointing European data could trigger a significant breakdown, especially if US numbers hold up better than expected.

GBPUSD faces a double test with both PMI data and retail sales figures. The pound has shown remarkable resilience in recent weeks, but this could be severely tested if either data point disappoints.

USDJPY and other yen crosses could experience heightened volatility around Thursday's Tokyo CPI release. With the yen already under pressure from interest rate differentials, any hint of accelerating inflation could spark a sharp reversal as markets reprice BOJ policy expectations.

USDCNH remains the barometer for trade war concerns. Despite the PBOC's steady hand on rates, the offshore yuan remains vulnerable to headlines and developments in the ongoing trade negotiations.

Equity markets in focus

Regional indices will respond differently to the week's events:

US indices (US500, US30, USTEC) have shown remarkable resilience despite trade concerns, but Wednesday's PMI data could be the catalyst for a reality check, particularly if manufacturing sentiment shows signs of deterioration.

European markets (DE30, STOXX50) appear more vulnerable, with the German DAX particularly exposed to both trade tensions and potential disappointment in manufacturing PMI data.

Asian markets (JP225, HK50) will continue to react to developments in the trade narrative, with Chinese stocks listed in Hong Kong especially sensitive to any signals about potential stimulus measures.

Commodities and vrypto

Gold (XAUUSD) has benefited from safe-haven flows amid trade tensions and could extend gains if economic data disappoints, reinforcing concerns about global growth.

Oil (UKOIL, USOIL) faces conflicting pressures, with trade concerns weighing on demand expectations while geopolitical tensions in the Middle East provide support. Wednesday's manufacturing PMI components will be closely watched for signals about industrial demand.

Trading strategies for a volatile week

With multiple high-impact events on the calendar, risk management takes center stage. Here are strategic approaches to consider:

1. Event-Risk Positioning: Consider reducing exposure ahead of Wednesday's PMI data deluge, which could trigger cascading market reactions across asset classes.
2. Asymmetric Opportunities: The Tokyo CPI release offers potentially asymmetric risk-reward, with markets not fully pricing in the possibility of accelerated BOJ tightening. Options strategies on yen pairs could offer attractive risk-reward.
3. Sector Rotation in Equities: Within equity markets, defensive sectors may outperform if PMI data disappoints. Conversely, a positive surprise could trigger a rotation back into cyclicals that have underperformed amid trade concerns.
4. Correlation Awareness: Traditional correlations may break down during periods of heightened volatility. The usual inverse relationship between the US dollar and commodities could temporarily decouple depending on the nature of economic surprises.

Conclusion: Preparation meets opportunity

Week 17 presents a complex tapestry of economic events against a backdrop of escalating trade tensions and shifting central bank expectations. While the headline events are clear, it's often the unexpected developments and market reactions that create the most significant trading opportunities.

The savvy trader will approach this week with both caution and readiness—managing risk prudently while remaining alert to the signals that emerge from each data release. In markets increasingly driven by algorithmic responses to headlines, understanding the broader narrative and positioning accordingly can provide a crucial edge.

This is not investment advice. Past performance is not an indication of future results. Your capital is at risk, please trade responsibly.

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Author:

Paul Reid

Paul Reid is a financial journalist dedicated to uncovering hidden fundamental connections that can give traders an advantage. Focusing primarily on the stock market, Paul's instincts for identifying major company shifts is well established from following the financial markets for over a decade.