On February 10th, Caixin News Agency reported that despite the Federal Reserve repeatedly suppressing expectations of interest rate cuts, investors postponed their prediction of the first rate cut to May. However, the US stock market continued to soar, with the S&P 500 index breaking through 5000 points and Wall Street ushering in a new milestone.
Looking ahead to next week, in terms of economic data, the US CPI inflation report for January will be released next Tuesday. It is expected that the unadjusted CPI annual rate for January will decrease from 3.4% in December to 2.9%, while the core CPI annual rate will decrease from the previous 3.9% to 3.7%.
Although the overall inflation rate in the United States is showing a downward trend, the vast majority of Federal Reserve officials have stated that interest rate cuts may take some time, which provides support for the US dollar, and investors expect the first rate cut to be in May.
In addition, the monthly retail sales rate in the United States, known as "terrorist data," is expected to slow down to 0.2% in January. Through retail sales data, the market will understand the health status of American consumers, and signs that consumers may be reducing spending will weaken expectations of a soft landing in the US economy, which will support the Federal Reserve to start a rate cut cycle as soon as possible.
In terms of geopolitical situation, due to the escalating tensions in the Middle East, crude oil futures prices have climbed to their highest level since the beginning of this month this week. Previously, Israel refused to accept the conditions proposed by Hamas for a ceasefire supported by the United States. The United States killed the commander of Iraqi militia using drones, and the US attack brought the US and Iran closer to direct confrontation.
On Friday, Israeli Prime Minister Netanyahu issued a statement stating that the military had been ordered to develop a dual plan to "evacuate" civilians from Rafah and the remaining Hamas camps, and a new offensive would be launched.
The United Nations has warned that Rafah has over 1.3 million people, most of whom have been "driven" from other parts of Gaza. If the Israeli military launches a military attack in such a densely populated area, it may ultimately lead to the death of a large number of innocent people. "In Rafa, people are becoming increasingly anxious and panicked because there is basically nowhere to go."
The Palestinian President stated that Netanyahu's military escalation plan in Rafah aims to drive the Palestinian people out of their land, and this action poses a threat to the security and peace of the region and the world, crossing all red lines.
The Director General of the United Nations Relief and Works Agency for Palestine Refugees in the Near East, Philip Lazarini, told the media on Friday that the current humanitarian situation in Rafah is "despairing" and that any major military action by Israel in Rafah in the future could bring more disasters to civilians.
International rating agency Moody's downgraded Israel's rating from A1 to A2 on Friday, with a negative outlook. Moody's believes that compared to before the outbreak of the Israeli Palestinian conflict, Israel is currently facing heavier debt pressure, its public finances are deteriorating, and Israel is preparing for a potentially prolonged war.
In terms of US stock market financial reports, companies such as Coca Cola, Kraft Heinz, Cisco, and Western Petroleum will announce their results. At present, over 80% of S&P 500 index constituent companies have exceeded expectations in profits, which is also the main reason for the continued rise of the US stock market.
Overview of important events next week:
Monday (February 12th): Germany's January CPI final rate, China's January M2 money supply annual rate, Canada's January employment figures, Russian President Putin's speech, Bank of Japan Governor Kazuo Ueda's speech
Tuesday (February 13th): US January New York Fed 1-year inflation expectations, UK January unemployment rate, Germany February ZEW economic sentiment index, US January unadjusted CPI annual rate, US January core CPI monthly rate, Richmond Fed Chairman Barkin's speech at the Atlanta Economic Club, OPEC releases monthly crude oil market report
Wednesday (February 14th): UK January CPI monthly rate, UK January retail price index monthly rate, US EIA crude oil inventory for the week ending February 9th
Thursday (February 15th): Australia's quarterly adjusted unemployment rate in January, UK's three-month GDP rate in December, US initial jobless claims for the week ending February 10th, US retail sales monthly rate in January, US Federal Reserve Manufacturing Index in February, Federal Reserve Director Barr delivering a speech at the American Business Economics Association meeting, Atlanta Fed Chairman Bostic delivering a speech on economic outlook and monetary policy at the New York University Money Market Practitioners Meeting, IEA releasing monthly crude oil market report
Friday (February 16th): Monthly retail sales rate after quarterly adjustment in January in the UK, monthly CPI rate in January in France, annual PPI rate in January in the US, monthly PPI rate in January in the US, annualized total new housing starts in January in the US, expected one-year inflation rate in February in the US, initial value of the University of Michigan Consumer Confidence Index in February in the US, speech by Federal Reserve Chairman Daley at the American Business Economics Association meeting in San Francisco, and speech by Atlanta Fed Chairman Bostic on economic outlook and monetary policy