Despite a holiday-shortened week in the US, investors have a busy calendar ahead with remarks from Federal Reserve policymakers, the release of Fed minutes, elections in Iran and negotiations over the European Union’s budget.
Here’s what to watch in the coming days.
Federal Reserve minutes
The Fed will release the minutes to its January 28-29 monetary policy meeting on Wednesday. Policymakers opted to leave interest rates unchanged but raised the interest it pays banks on the reserves they hold on the central bank’s balance sheet at their meeting last month.
“The minutes are unlikely to include any major new revelations on the near-term outlook relative to what was said in the press briefing and this week’s testimony,” strategists at TD Securities said. “However, they will likely include an update on the review being conducted by the Fed. We expect the review to result in the adoption of some form of average inflation targeting, which is dovish given sub-2% inflation.”
Through the week investors also get to hear from a handful of voting members of the Federal Open Market Committee, including Minneapolis Fed president Neel Kashkari, Cleveland Fed president Loretta Mester, Dallas Fed president Robert Kaplan and Fed governors Lael Brainard and Richard Clarida.
Democratic debate
A Democratic primary debate, which will air on NBC News and MSNBC, is scheduled to take place in Las Vegas on Wednesday. The Democratic National Committee has changed the requirements to participate in the debate and candidates can now qualify by either meeting a delegate or polling threshold.
The change in rules, including an elimination of a fundraising requirement, means that Michael Bloomberg could take the stage for the first time this campaign season. Thus far, Pete Buttigieg has emerged from the first two Democratic contests as the moderate to beat, though he is just marginally ahead of progressive frontrunner Bernie Sanders. The debate comes ahead of the Nevada caucuses scheduled to take place on Saturday.
EU budget
The stage has been set for a fierce battle at the EU summit in Brussels on Thursday to negotiate its budget over the next seven years.
European Council president Charles Michel has proposed a 2021-2027 budget at just over 1.07 per cent of EU gross national income.
Mr Michel’s proposal is roughly €240bn shy of parliament’s demand for a budget of 1.3 per cent of EU gross national income. It is also about €100bn more than richer countries like Austria and the Netherlands are willing to pay.
Iran election
Iranians head to the polls on Friday to vote in parliamentary elections. Hardliners feel emboldened by the public outpouring of grief for military commander Qassem Soleimani, who was killed in a US air strike, and see the poll as a chance to forge a radical new parliament. More than 90 sitting MPs, including conservatives and hundreds of reformist candidates, have been told they cannot contest the polls. Read more from the FT’s Najmeh Bozorgmehr here.
US markets will be closed on Monday in observance of Presidents Day.
