Archives of “February 2020” month

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Federal Reserve FOMC January meeting minutes this week – preview

  
Analysis, Economy
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The minutes of the Federal Open Market Committee meeting will be published on Wednesday 19 February 2020  at 1900GMT

A couple of snippets on what to expect and look out for, via Scotia.
  • Watch for frequency of citation references to how the committee views downside risks to the outlook
  • Recent references to downside risks have fanned market pricing for easing
  •  (chart 2). During the press conference on January 29th, Powell guided that there had been a Further clues regarding expectations for the mid-year announcement of the strategic review are possible
  • watch for further discussion of the merits of average inflation targeting around a 2% goal
  • balance sheet policy guidance … we might develop a further understanding of the range of FOMC opinions
  • coronavirus and its potential impact. Watch for any further discussion and the range of views on the implications for world and domestic growth and inflation. 
The minutes of the Federal Open Market Committee meeting will be published on Wednesday 19 February 2020  at 1900GMT

IMF on coronavirus and the global economy – damage this year; sharp, rapid rebound

  
  Analysis
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Comments from International Monetary Fund managing director Kristalina Georgieva over the weekend on the impact on the global economy

  • could damage global economic growth this year
  • a sharp and rapid economic rebound could follow
  • “There may be a cut that we are still hoping would be in the 0.1-0.2 percentage space”
  • full impact of the spreading disease would depend on how quickly it was contained – “I advise everybody not to jump to premature conclusions. There is still a great deal of uncertainty. We operate with scenarios, not yet with projections, ask me in 10 days”
  • If the disease is “contained rapidly, there can be a sharp drop and a very rapid rebound”, in what is known as the V-shape

Japan – Reuters Tankan for Feb shows slight improvement

  
Analysis, Economy

Reuters monthly poll tracks the Bank of Japan’s key tankan quarterly survey

  • Japan manufacturers index -5 in February vs -6 in January
  • non-manufacturers index +15 vs January +14
  • Japan manufacturers May index seen at -5, non-manufacturers +15
One of the comments from the poll of firms:
  • “Just as the domestic economy’s slump following the sales tax hike is becoming evident, the coronavirus spread has made China-bound exports totally unclear”
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 Reuters poll of 502 large- and mid-sized companies, in which 245 firms replied
  • indexes are calculated by subtracting the percentage of pessimistic respondents from optimistic ones
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