By Noreen Burke
Investing.com – The week ahead should be fairly calm as the spring meeting of the International Monetary Fund and the Federal Reserve minutes, as well as the most recent meetings of the European Central Bank, fill the void before earnings season kicks off in the middle of the month. Equity markets are likely to receive a boost from Friday’s stronger-than-expected US job report, and investors will watch if Congress approves President Joe Biden’s massive infrastructure plan announced last week. Monday’s ISM services sector data will also be in focus after a similar metric rose for manufacturing in March. Here’s what you need to know to start your week.
The stock market profits could continue
US equity markets started on strong foundations in April, with the S&P 500 index hitting the 4,000 level for the first time last Thursday. Those gains could continue after the Labor Department reported Friday that the U.S. economy added 916,000 Jobs in March, most in seven months, while employment growth in February was also greater than previously thought.
Stock markets were closed on Good Friday in the US, Europe and elsewhere and will remain closed on Easter Monday in some regions.
The market rally was driven by massive US stimulus measures and expectations that the vaccine launch will fuel the economic recovery.
Investors will also be watching to see if Congress passes the infrastructure plan that President Biden unveiled last week. It includes $ 2 trillion in spending but also plans to raise corporate taxes that investors fear could hurt profits.
The IMF is slated to begin its spring meetings (virtually) on Monday, where policymakers will provide an overview of the economic impact of the pandemic, but will also publish updated growth forecasts for 2021 and 2022.
IMF managing director Kristalina Georgieva has already announced that the updated world economic outlook revises the January forecast for global economic growth of 5.5% this year upwards.
Aside from the updated economic outlook, G20 finance ministers will meet on Wednesday to discuss debt relief initiatives.
Minutes of the central bank
The Federal Reserve publishes the protocol During Wednesday’s March meeting, investors will be on the lookout for new insights on inflation as they fear unprecedented stimulus will lead to mounting price pressures.
Fed chairman Jerome Powell downplayed inflation concerns after the bank’s March meeting, saying policymakers view inflationary pressures as temporary.
The ECB will publish its latest version Minutes of the meeting on Thursday. Last week, ECB President Christine Lagarde said investors could test the bank’s willingness to contain rising borrowing costs “as much as they want”.
Powell, Fed spokesman
Investors will watch a performance by Fed Chairman Jerome Powell, who will discuss the global economy on Thursday at an IMF panel.
Other Fed policy makers appearing during the week include Richmond Federal Reserve President Tom Barkin on Wednesday and Chicago Federal Reserve President Charles Evans, due to deliver an opinion Tuesday and Wednesday.
Meanwhile, US Treasury Secretary Janet Yellen will speak on Monday’s webinar for the Chicago Council on Global Affairs on how the world economy is recovering from the pandemic.
The Institute for Supply Management will publish the closely observed data Service sector Activity on Monday. An ISM manufacturing survey released late last week found that activity in March reached its highest level in 37 years, a strong indicator that an economic recovery is likely to be underway.
The economic calendar also includes the weekly data from Thursday too initial unemployment claims along with numbers on Producer price inflation on Friday being checked for signs of developing inflationary pressures.
–Reuters contributed to this report