Week Ahead – Interest rate anxiety heightened

Can earnings season soothe investors’ nerves?

It’s been a turbulent start to the year in the markets and that’s unlikely to change as we move into earnings season. Fear of high inflation and accelerated monetary tightening is driving much of the volatility that we’re seeing in financial markets over the last couple of weeks and that’s unlikely to abate any time soon, with peak inflation still probably ahead of us.

Earnings season could go some way to easing the nerves in the coming weeks as we get a reminder that the economy is still in a strong position despite the challenges it’s facing. But even this comes with an element of uncertainty given that omicron hit in late November which will undoubtedly have had an impact. Of course, as we’ve seen the last two years, there are also winners when consumers stay at home and restrictions are imposed.

Ultimately though, central banks remain at the top of the list for investors right now and next week offers a selection of meetings, minutes, and speakers that will surely attract a lot of attention. It’s hard to look past the CBRT on Thursday as being one of the highlights next week. After an aggressive easing cycle that’s come at a huge cost, will the central bank finally slam on the breaks?

Banks get earnings season underway

Lira steadies ahead of CBRT meeting

Chinese data to start the week


The upcoming week is busy with economic data and earnings results.  Goldman Sachs, Bank of America, and Morgan Stanley will close out earnings for the big banks, while Procter & Gamble may give a better look at how much further price increases the consumer may have to expect.  On Tuesday, the Empire Manufacturing Index should show activity cooled in January.  Wednesday is all about housing activity that might show both building permits and housing starts edged down.  On Thursday, initial jobless claims are expected to resume declining, while the Philadelphia business outlook is anticipated to improve, and Existing home sales may show a small decline.  

The blackout dates are in effect for the Fed, so it will be quiet until the January 26th FOMC meeting. With financial markets pricing in over a 90% chance that the Fed will raise rates in March, Treasury yields appear to be forming a range just below the 1.80% level.     


With the ECB being among the minority of central banks still singing from the transitory hymn sheet, the focus next week will be on the ECB accounts from December, comments from policymakers including President Christine Lagarde on Monday, and the final inflation numbers for December. At 5%, inflation is uncomfortably high and the central bank may soon finally buckle like the rest if pressures don’t soon ease.


The data dump week for the UK, with labour market, inflation, and retail sales all being released. But Wednesday is undoubtedly the standout, with Governor Bailey due to speak hours after the CPI release which could make for some interesting comments. Three or four rate hikes are expected this year so expectations are quite hawkish but as we’ve seen recently, there is a growing fear that more will be warranted.


No major data or economic events next week so the focus will remain on the various geopolitical risks that Russia has found itself at the centre of. A possible invasion of Ukraine is very much top of the list, with the week of intense talks between the US and Russia seemingly failing to lead to any breakthrough. 

Russia is also intrinsically linked to the energy crisis in Europe which is intensifying as more outages in French reactors put further pressure on limited reserves.

South Africa

Inflation data next week is expected to show price pressures increasing, with the CPI rising to 5.7% which will increase calls for more rate hikes from the SARB.


A rare period of relative stability for the lira which is unlikely to last, as the CBRT meets next week. Can the central bank resist the urge to cut again or are more sharp losses on the horizon? Not cutting could provide some support for the lira as it may signal an end, for now, of the easing cycle. 


China releases fourth-quarter GDP and Retail Sales on Monday. The markets are braced for a downturn in growth, with a consensus of 3.5%, down from the gain of 4.9% in Q3. This would mark the weakest GDP report since Q2 2020.

Retail Sales are forecast at 3.8% y/y in December, down from 3.9% beforehand. The government has enacted a zero-Covid strategy, which has restricted travel and dining out. Slow income growth is also hurting consumers and has put a dampener on consumer spending.

China’s property sector remains in deep crisis, with no signs of any improvement on the horizon. Evergrande and other developers owe billions and investment growth and household loans have decreased. The government has eased restrictions on real estate funding but these measures have so far proven ineffective.

China’s house price index is released on Saturday which could put a dampener on the open if it’s particularly bad news. The previous release showed 3% growth though and it’s widely regarded as low impact data. 

Also on Monday, ahead of the GDP release, the PBOC will decide whether to maintain the MLF rate at 2.95%.


No major economic data or events next week.


Australia releases key employment data for December next week. Employment change is expected to slow to 60,000, down from 366,100 in November. The unemployment rate is forecast to ease to 3.5%, down from 3.6%.

Iron ore prices rose to their highest level in three months, as heavy rains engulfed Brazil’s mining region, which has sparked supply concerns.

New Zealand

It’s a quiet economic calendar next week. On Thursday, New Zealand releases the BusinessNZ Manufacturing PMI for December. The PMI was stagnant in November, with a reading of 50.6 points.


Inflationary pressures in Japan are much lower than those in the UK or the US, but inflation is nonetheless moving higher after years of deflation. The Bank of Japan is expected to maintain its ultra-loose policy at its meeting on Tuesday, but will likely revise up its view of inflation risks for the first time since 2014. 

Inflation remains well below the bank’s target of 2%, but the BoJ could look to raise interest rates before it achieves it.

Economic Calendar

Saturday, Jan. 15

Economic Data/Events

China new home prices

Sunday, Jan. 16

The US’ National Retail Federation opens its annual Retail’s Big Show expo at Javits Center, New York  

Monday, Jan. 17

Economic Data/Events

US equity and bond markets are closed for Martin Luther King Jr. holiday

China GDP, retail sales, industrial production, surveyed jobless, property investment, medium-term lending

Handelsblatt Energy Summit with German Economy Minister Habeck

Finance ministers of the Euro region meet in Brussels

Japan PM Kishida speaks to parliament

Canada existing home sales

Poland CPI

Japan industrial production, core machine orders, tertiary industry index

Singapore electronic exports

Russia Trade

Norway Trade

Philippines overseas remittances

UK Rightmove house prices

Switzerland sight deposits, Bloomberg January economic survey

Turkey central government budget balance

Tuesday, Jan. 18

Economic Data/Events

US cross-border investment, empire manufacturing, NAHB Housing Market Index

BOJ Rate Decision: No change to monetary policy, may adjust its view of inflation risks

Japan industrial production, capacity utilization

EU finance ministers meet in Brussels and hold a policy debate on global minimum taxation for multinational companies.

Australia consumer confidence

Canada housing starts

Eurozone new car registrations

Germany ZEW survey expectations

New Zealand house sales

Russia Trade

Mexico international reserves

UK jobless claims, unemployment

Poland CPI

Switzerland producer and import prices

South Africa mining, gold, and platinum production

Turkey house price index

Sweden Riksbank Gov Ingves speaks on a panel at a blockchain and stablecoin conference

Wednesday, Jan. 19

Economic Data/Events

US housing starts

UK CPI, house price index

French President Macron addresses European Parliament

BOE Gov Bailey speaks to UK Parliament Treasury Committee

Canada CPI

Germany CPI

South Africa CPI

Eurozone construction output

Australia Westpac consumer confidence

New Zealand card spending

South Africa retail sales

Russia current account

Bank Earnings from BoA and Morgan Stanley

Thursday, Jan. 20

Economic Data/Events

US existing home sales, initial jobless claims

ECB Minutes to December policy meeting

BOJ Minutes of December meeting

UK RICS house prices

Norway Rate decision: Expected to keep rates steady

Turkey Rate decision: Expected to keep rates steady

Hungary Rate decision: Expected may keep rates steady

Eurozone CPI

Hong Kong CPI

Russia CPI 

Japan Trade

China loan prime rates, swift global payments

Australia unemployment, consumer inflation expectations, RBA FX transactions

New Zealand food prices, ANZ Truckometer heavy traffic

Germany PPI

Taiwan export orders

Mexico unemployment

Spain house transactions, trade

France business and manufacturing confidence

Netherlands unemployment, consumer spending

Poland consumer confidence

EIA Crude Oil Inventory Report

Netflix reports earnings after the bell

Friday, Jan. 21

Economic Data/Events

US Conf. Board leading index

Japan CPI

UK Retail sales

BOE Mann speaks at the Official Monetary and Financial Institutions Forum

Canada Retail

Eurozone Consumer confidence

Bank of Italy releases the Quarterly Economic Bulletin

Turkey Consumer Confidence

New Zealand performance of manufacturing index, net migration

Singapore home prices

Switzerland Money supply

Russia Money supply

Thailand trade, forward contracts, foreign reserves

China FX net settlement

Poland sold industrial output, construction output, employment, PPI

Sovereign Rating Updates



This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam