The FOMC showed a hawkish shift but Fed Chair Jerome Powell successfully unwound some to suggest policy normalization won’t derail the recovery. Personal spending data will be watched closely to see if higher prices are impacting consumers and shifting from goods to services.
Arrows indicate consensus forecast compared to the previous period. Local dates of release.
- The core PCE deflator—the Fed’s preferred inflation measure—is expected to increase in November amid protracted supply constraints and elevated demand.
- Meanwhile, November’s personal spending data will be watched closely to see if higher prices are impacting consumers and how much spending is shifting from goods to services, given weaker-than-expected retail sales growth in November.
- U.K. GDP 3Q21 growth will show whether the economy advanced less than expected.
- Euro area and U.K. December Consumer Confidence will give an indication of whether Omicron is affecting consumers’ decisions.
- The PBOC meeting for December will likely see key policy interest rates remain unchanged, as policymakers focus on targeted stimulus measures, such as open market operations and targeted relending (to SMEs and decarbonization efforts) rather than broad-based support.
- Japan CPI is likely to remain subdued, given still-tepid domestic demand.