Week in a Glance: CoinBase's IPO, US and China Data, Reporting

19 apr 2021

The past week was marked by heightened optimism in the financial markets. The reason was both excellent data on the US and China economies, and the Fed's head's comments. U.S. retail sales are up nearly 10% (yes, mostly due to the $1,400 lump sum from the pandemic relief package, but still impressive), and jobless claims fell to 576,000, which is the best week since the start of the pandemic. China, on the other hand, reported that its GDP grew by 18% against the same period last year, with retail sales growing by 34%.

Fed Chairman, Jerome Powell, once again (already at the mantra level) noted that the Fed doesn't plan any rate hike in the foreseeable future (till 2023).

The start of the earnings season turned out to be extremely successful: banks beat analysts' forecasts. The reasons for their strength are a sharp increase in income from investment and trading areas, as well as write-off of reserves.

As a result, US stock indices were updating their historic highs almost on a daily basis. The cryptocurrency market also felt great amid growing demand for risky assets. An additional reason for optimism was the CoinBase IPO. As a result, Bitcoin became the 5th largest currency in the world, even ahead of the British pound. Well, CoinBase has confidently surpassed Nasdaq in terms of capitalization, which it's quoted on.

Bank of Turkey surprised by leaving the monetary policy parameters unchanged. Although it'd seem that Erdogan dismissed the previous head because of his unwillingness to lower the rate. And take the new chapter, and leave the rate unchanged. So the question arises: was it worth the dismissal of the previous chapter and provoke the exodus of investors and the fall of the lira?

OPEC and the International Energy Agency last week simultaneously raised their forecasts for the growth rate of demand in 2021, which provoked a jump in oil prices. Oil on the fire was added by data on oil reserves in the United States, which showed their decline.

The coming week will be rich in data on the UK economy: labor market, inflation, retail sales, business activity indices. In addition, the reporting season will gain momentum. It is also worth paying attention to the announcement of the results of the meetings of the Bank of Canada and the ECB, although no surprises should be expected from them.