Every Friday, Brian Jacobsen provides perspective on key events and topics of the current week and his thoughts about what the week ahead may hold. Here’s his report for the week of January 9–15, 2021.

The week that was

  • Headlines were focused on the second impeachment of President Trump. A majority of the members of the House of Representatives voted to impeach, but the Senate is not likely to hear the trial until after President Trump leaves office.
  • Earnings season kicked off with some banks reporting their earnings. For the fourth quarter, companies within the S&P 500 Index are expected to show an average 8.32% year-over-year decline in earnings per share. Sales are expected to rise 0.34%.


  • There were quite a few speeches by Federal Reserve (Fed) officials. From my perspective, one theme that emerged was that they’re still nervous about the outlook but firmly believe a widespread vaccine rollout could boost growth substantially in the second half of this year. Some Fed officials said that means the Fed could start tapering its asset purchase program at the end of 2021 or the beginning of 2022.
    • The Beige Book (a collection of qualitative information from across the various Fed districts) said economic activity increased modestly at the end of 2020. Services have suffered under rising COVID-19 cases and renewed restrictions on activity, but manufacturing has continued to recover.
    • Fed Chair Powell spoke at a conference and said that the time for raising interest rates is “no time soon.”


  • President-elect Biden revealed an outline of his economic stimulus plan. Everything is subject to House and Senate negotiations and approvals, but his agenda included: $1,400 payments to individuals; supplementary unemployment benefits through September; $350 billion for state and local governments; raising the minimum wage to $15/hour; and money to help schools reopen, fund nationwide vaccination and testing, support renters and landlords, and fund many other programs. Some items that affect the budget could pass separately under budget reconciliation—which requires only a majority vote in the Senate—while others would likely require 60 votes to pass.
  • Former Italian Prime Minister Renzi’s small party pulled out of the governing coalition. As a result, Italian Prime Minister Conte has been struggling to find a majority in Parliament. Renzi said his party is dissatisfied with Conte’s handling of the pandemic.
  • The Trump administration banned the importation of all cotton and tomato products made by Uighurs in China. The Trump administration has already banned imports from companies tied to the forced labor of ethnic minorities in China’s Xinjiang Uyghur Autonomous Region.

The week to come

  • Fourth-quarter earnings season ramps up.
  • The week starts early with the release of China’s gross domestic product (GDP) and industrial production numbers on Saturday. The consensus is calling for a year-over-year increase of 6% for fourth-quarter GDP. That would mark an impressive comeback from China’s economic rout in the first quarter of 2020.
  • On Wednesday, the U.K.’s December inflation and retail sales data are released. Eurozone inflation numbers will also come out. In the U.S., the National Association of Home Builders (NAHB) releases the January NAHB/Wells Fargo Housing Market Index, a survey of homebuilder sentiment. Late on Wednesday (ET), the Bank of Japan releases its policy statement.
  • On Thursday, the European Central Bank releases its policy decision. It has already recalibrated its asset purchases, so this meeting will likely just be a check-in on its view of the economic outlook. U.S. housing starts and building permits data for December will be released on Thursday, too.
  • Friday will be a big day, with preliminary readings of the January purchasing managers’ indexes coming out. U.K. retail sales for December and U.S. existing home sales for December are also to be released.

Thanks for reading, stay informed!

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