Weekly Wrap-Up

Last Week In Markets: Mar 07 - Mar 11 2022

Fisher Investments recaps the biggest market, political and economic news from last week, including US inflation data, UK industrial and manufacturing production figures and Japan’s preliminary money supply data.

In the US, data were light. February core consumer prices (excluding food and energy) rose 0.5% m/m and 6.4% y/y, in line with estimates. The February headline CPI inflation rate accelerated to 7.9% y/y, with rising energy and used vehicle prices among the largest contributors. We don’t know how long the Russia/Ukraine conflict will contribute to near-term energy price pressures, but we continue to expect inflation to eventually decelerate as supply chain bottlenecks and goods shortages work themselves out. The pandemic prompted a shift in consumer behavior from services towards goods, and rising goods prices have primarily contributed to recent inflation. Over time, we believe the recent spike in goods demand likely shifts back more towards services. Additionally, businesses will continue adapting to help ensure supply more adequately meets demand. In our view, these combined factors should help ease current price pressures for various goods as this year progresses.

In the UK, January industrial production rose 0.7% m/m and 2.3% y/y. January manufacturing production increased 0.8% m/m and 3.6 % y/y. In the eurozone, the third estimate of Q4 2021 GDP growth was 0.3% q/q and 4.6% y/y—in line with expectations. The European Central Bank left interest rates unchanged but indicated they would accelerate winding down their asset purchase program this year.

In Japan, preliminary January money supply (M2) increased 3.6% y/y, slightly above consensus estimates. January bank lending rose 0.4% y/y. The second estimate of Q4 2021 GDP showed growth of 1.1% q/q and 0.4% y/y, both less than expected. In China, January lending increased 11.4% y/y, while money supply (M2) expanded 9.2% y/y, both below forecasts. Consumer prices rose 0.9 % y/y in February, in line with estimates.

The Week Ahead:

The eurozone and Japan report January industrial production, while the US reports February industrial production. The US and China release February retail sales figures, while Japan releases January retail sales figures. China and Japan post February trade data. The eurozone and Japan report February inflation data. The US releases February manufacturing production. The US Fed, Bank of England and Bank of Japan meet to set their respective monetary policies.

Source for all data cited is FactSet. This update constitutes the general views of Fisher Investments and should not be regarded as personalized investment advice. No assurances are made we will continue to hold these views, which may change at any time based on new information, analysis or reconsideration. In addition, no assurances are made regarding the accuracy of any forecast made herein. Global equities are represented by the MSCI World Index. The MSCI World Index measures the performance of selected stocks in 23 developed countries and is presented net of dividend withholding taxes and uses the maximum rate applicable to non-resident institutional investors who do not benefit from double taxation treaties. Past performance is no guarantee of future results. A risk of loss is involved with investments in stock markets.