Tomorrow's Macro Roadmap: AU inflation expectations / Swiss sight deposits & PMI / EZ & US PMIs / RBA, BOJ, BOE & ECB speak
Good evening,
I hope you had a relaxing weekend.
Given the events in the Middle East, macro events might take a back seat for now, but here is tomorrow's Maco Roadmap nevertheless:
In Switzerland, the SNB will release its update on sight deposits for last week at 10:00 CET. They are far from a perfect proxy for SNB interventions in foreign exchange markets and are influenced by other factors, yet they remain worth monitoring. In its latest statement, the central bank reiterated its willingness to intervene as necessary. They have increased for two weeks in a row now.
In the Eurozone, the final February manufacturing PMIs are expected to confirm the flash readings, which signalled a meaningful improvement. The Euro area composite is expected at 50.8 (from 49.5 in January) — a potential return to expansion territory for the first time since mid-2024. The improvement was led by manufacturing, with German fiscal spending (especially on defence) starting to flow through.
The US ISM Manufacturing PMI is the day’s most important release. The consensus is for a decline to 52.3 in February, down from 52.6 in January. January’s 52.6 reading was the strongest since August 2022, but investment banks broadly agree the surge overstated underlying momentum. One investment bank forecasts a sharp pullback to 50.0, well below the consensus of 52.3, arguing that qualitative comments from the January survey pointed to temporary drivers — “a number of comments mentioned post-holiday replenishment and customers’ desire to get ahead of additional tariff-driven price increases as possible reasons for the increase.” Wells Fargo is more sanguine at 52.0, noting that “the improvement comes amid an upswing in capital spending — highlighted by broadening in durable goods orders — as well as restocking efforts in the wake of last year’s tariff hikes.” Regional PMIs for February show manufacturing continued to expand, though at a more even-keeled pace.
The key sub-indices to watch are: New Orders (previous 57.1, nearly a 10-point January jump), Prices Paid (consensus 59.5 vs previous 59.0), and Employment (previous 48.1, still in contraction).
Regarding central bank speakers, BoJ Deputy Governor Himino speaks to business leaders in Wakayama (02:30 CET). This is his first public speech since September 2025 and comes ahead of the anticipated April rate hike. In his last speech, he argued that real interest rates in Japan remain low despite three rate hikes since normalisation began, and the BoJ should continue raising the policy rate as the economy improves. He acknowledged US tariff uncertainties as downside risks but maintained that underlying inflation is approaching the 2% target. He endorsed a gradual reduction in JGB purchases from 6 trillion yen/month to 3 trillion by spring 2026. Markets will watch for signals on the anticipated April rate hike, especially given the government’s recent appointment of two reflationist academics to the BoJ board, replacing outgoing doves.
ECB’s Elderson (10:15 CET) speaks at a FINRESP sustainable finance conference in Madrid, followed by ECB President Lagarde (15:00 CET) at a Financial Literacy event in Frankfurt, and Bundesbank’s Nagel (15:00 CET) — both speaking simultaneously.
BoE’s Taylor (13:30 CET) speaks at the Norges Bank monetary policy regulation conference in Oslo — notable as one of the MPC’s most dovish members (voted for a cut at the Feb meeting). Taylor is among the most dovish MPC members, voting for a 25bp cut to 3.50% at the February meeting (part of a 4-member minority). He said elevated US tariffs are “here to stay” at levels “an order of magnitude” larger than two years ago, with the economic shock playing out “over many years.” He sees early signs of Chinese export diversion toward the EU and UK, which could have deflationary effects. In his January Singapore speech, he argued inflation is on track to hit the 2% target by mid-2026 and expects “two or three more quarter-point rate cuts” before a pause. At the Norges Bank conference, his panel on “Getting the right directions” may produce fresh policy signals ahead of the BoE’s March decision. BoE’s Ramsden (16:30 CET) appears before the Public Accounts Committee on the RTGS renewal programme — not a monetary policy event.
RBA Assistant Governor Hunter, who is also the central bank’s Chief Economist, used a DNA double helix metaphor to argue that the RBA’s dual mandate objectives — full employment and price stability — are “separate, yet entwined.” She assessed the labour market “remains somewhat tight” despite easing, with underlying inflation around 3.25% and unit labour costs elevated. She concluded that inflationary pressures persist despite anchored expectations, supporting the Board’s decision to raise the cash rate.
RBA Governor Bullock defended the Board’s decision to raise the cash rate by 25bp to 3.85%, citing underlying (trimmed mean) inflation rising to 3.4% by December 2025 — materially above RBA forecasts. She stressed that stronger-than-expected aggregate demand was pushing up against supply capacity. She noted the Board “stands ready to hike again if inflation proves persistent.”