Week Ahead—Economic Data to Shape Market Trend

Markets entered the week with renewed optimism following a softer tone from President Trump on trade policy. The U.S. Dollar rebounded, while gold experienced a significant sell-off driven by profit-taking. Meanwhile, global stock indices rallied sharply, supported by easing trade tension and improved risk appetite.

On the trade front, President Trump appeared to soften his stance on China tariffs and the reciprocal tariff policy. He signalled that the administration is considering a substantial reduction in tariff rates — potentially lowering them to the 50%–60% range — though he emphasized they will not be eliminated entirely.

Week Ahead—Economic Data to Shape Market Trend

This week, market attention shifts to a series of key economic data releases from major economies. With April marking the first full month since the announcement of Trump’s reciprocal tariff policy, global investors are eager to assess how the measures may be impacting economic performance.

In particular, investors will be watching closely for signs of change in inflation and labour market conditions in the United States. The spotlight will be on two major releases:

• The PCE Price Index (Thursday), the Federal Reserve’s preferred inflation gauge
• Non-Farm Payrolls (NFP) (Friday), a crucial measure of labour market strength

Meanwhile, the Bank of Japan’s rate decision on May 1st will also be in focus.

Markets are watching to see whether persistent inflation pressures will prompt a shift in policy tone, which could influence the direction of the Japanese Yen, a key safe-haven asset.

1. Australian Consumer Price Index — April 30^th

The RBA delivered its first rate cut since November 2020 on February 18, 2025, amid easing inflation and slowing growth. While holding steady since then, the RBA remains cautious and data-dependent.

The upcoming Q2 inflation data will be key. A weaker print may raise expectations for further easing and weigh on the Australian Dollar.

2. Eurozone GDP Q1 & CPI — April 30^th & May 2^nd

With the ECB already in an easing cycle, markets are watching closely for further signals of rate cuts, especially if inflation falls below the central bank’s target. This week’s Eurozone GDP and CPI data will be critical in shaping expectations.

Any surprises could impact the Euro, which has recently strengthened mainly due to broad U.S. Dollar weakness.

3. Bank of Japan Rate Decision — May 1^st 

The BoJ has maintained a hawkish stance since its first-rate hike in 2024, but its tightening path remains gradual due to concerns over how global trade tensions may affect Japan’s economic growth. While the central bank is widely expected to keep rates steady at 0.5%, markets will be watching closely for any signals on the future policy path.

4. US PCE Price Index & Non-Farm Payroll — April 30^th & May 2^nd

U.S. inflation and labor data are in sharp focus this week, as investors look for more clues on how Trump’s tariff policies are impacting the economy. A rise in inflation coupled with signs of a weakening labor market could weigh heavily on both the U.S. stock market and the U.S. Dollar.

Key Takeaway for the Week

Markets this week are expected to be driven by key economic data releases, which will shape how investors interpret the impact of Trump’s tariff policies on the global economy.

If the data points to slowing growth, concerns over global economic weakness and potential recession could resurface. On the other hand, stronger-than-expected figures may reinforce the recent wave of optimism and support risk sentiment.