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The big three

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  • A lack of macroeconomic news at the end of last week pushed Ukrainian risks up the agenda of investors. The Ukrainian situation does not appear to have changed, but an increase in macro events and data this week is likely to downgrade the focus on it.
  • The US is offering the big three of Fed, GDP and employment data. Of these GDP is probably the least important to markets, as whatever the outcome weather distortions can be blamed for any deviation from consensus.
  • The Fed and employment are intimately intertwined. As the end of quantitative policy stimulus approaches, the debate will shift to when and how monetary policy is tightened. The composition of the Fed is set to change, and structural changes allow for much uncertainty.
  • The Euro area has little to offer in competition to the US data flow (and much of Continental Europe will take a holiday this week). However the credit rating agencies were active last week, downgrading Russia and upgrading Spain.

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