Weekly financial market overview 10.05.-16.05.
Main events of the previous week
The European Commission has improved its forecast for the growth of world GDP to 5.6% in 2021 compared to 4.6% projected in the fall. In 2022, the European Commission predicts the growth of the world economy at 4.3%. Presenting this forecast, European Economic Commissioner Paolo Gentiloni said that the forecast sounds optimistic, although risks still remain. He also stressed that the engines of growth in the global economy will be rapid economic growth in China, which was able to curb the pandemic at an early stage, and in the United States, where a successful vaccination campaign continues. According to the document, the growth of the EU economy will be 4.2% in 2021, and 4.4% in 2022. Growth in 2021-2022 will actually be a recovery after a record for the entire post-war period of economic decline in the 27 EU countries, which amounted to 6.1%. For the euro area, the European Commission predicts a similar trend: after a record decline of 6.6% in 2020, growth is expected at 4.3% in 2021, and 4.4% in 2022. Inflation in 2021 will be 1.7%, which is close to the European Central Bank's target of 2%. Gentiloni said that this positive outlook contains a number of risks and uncertainties, most of which relate to the impact of the pandemic response, as well as the risks of new pathogenic strains of coronavirus that are resistant to existing vaccines.
US. The number of initial jobless claims for the week was registered in the amount of 473 thousand, which is 34 thousand less than the previous week and 17 thousand less than predicted by analysts.
The consumer price index in April rose by 0.8% versus March, while the annual inflation rate was 4.2%. The growth of the core inflation rate excluding food and energy in April amounted to 3% y/y.
The volume of retail sales in April remained at the level of March. In turn, excluding data on the sale of gasoline and cars from the indicator, retail sales in April decreased by 0.8%.
China. The consumer price index in April fell by 0.3% versus March, while the annual inflation rate was 0.9%.
Key events this week
- On Monday, China will report on the growth of industrial production, retail trade, as well as the state of the labor market in April.
- On Tuesday, the Eurozone will publish data of the trade balance for the month of March, as well as the GDP data for the first quarter.
- On Wednesday, the Eurozone will report inflation numbers in April, the US will know the change in oil reserves for the week, and the Fed will publish the minutes from the last meeting.
- On Thursday, the US will publish the number of initial jobless claims for the week.
- On Friday, the level of business activity in May will become known in the Eurozone and the United States.
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