Macroeconomics: The Week Ahead: 14-18 July 2025

The Week Ahead – Preview: 

The new week brings a rush of major data from the US (CPI, PPI, Retail Sales, Industrial Production, Beige Book), China (Trade, Retail Sales, Industrial Production, FAI, Property Investment), UK (CPI, Unemployment, Wages, BRC Retail Sales) and Japan (National CPI, Trade, Orders), accompanied by Germany’s ZEW survey, Canadian CPI and Australian Employment.

But with the US administration threatening an array of its closest trading partners with tariffs well in excess of the original baseline 10%, and in a number of cases above the ‘Liberation Day’ levels, with the added complexity of numerous sectoral tariffs, trade and geopolitics will top the agenda. To be sure, the US stance can be construed as ‘maximum pressure’ tactics (aka “gunboat diplomacy”), but also as exhibiting a petulant impatience that rides roughshod over the fact that trade deals are de facto complex among and between developed nations, and therefore take a lot more time than a few months. After all the UK and US had been negotiating for more than 5 years, and then only managed to come up with a framework agreement, to form the basis for further negotiations. It should serve to remind ‘risk hungry’ financial markets that dismissing tail risks (not only related to trade) is hardly wise. But then again there remains $20.0 Trln of G4 central bank QE in the world, despite their balance sheet reduction efforts. Central banks tacitly and implicitly admit that this has impaired (nigh on destroyed) markets’ reaction function (more than amply demonstrated this year). It has also unleashed chronic asset price inflation and deepened economic inequality and developed world fiscal profligacy, underpinned demand for private credit and crypto assets, as the processes of financial disintermediation and fracturing become more entrenched – but why should anyone in financial markets care about any of those issues? It’s only (gambling) money after all? Isn’t it?

Geopolitically, outside of the US administration’s policy dynamics, two important themes appear to be emerging: a) President Xi’s grip on China is being prised away from him thanks to a faltering economy, whether what follows is along the lines of Deng Xiaoping is written in the stars. b) The US and EU’s equivocal efforts to support the Ukraine suggest its future as an independent state is now very questionable, and by extension a broader war between Europe and Russia before the end of this decade is looking ever more likely, exposing the chronic inability to reform regional and multilateral institutions to shifting and evolving balances of power around the world. Underlying all of this is a failure to recognise that if debate and dialogue are no longer the lingua franca at all levels of society and politics, then aggression, confrontation and the thoughtless machismo of ‘might is right’ will beget violence, conflict and likely tragic and horrific consequences for the largely silent majority.

The week also marks the official start of the US Q2 earnings season, with expectations for overall S&P 500 earnings having been reduced from 10.2% at the start of Q2 to 5.8%. Banks and other financials will get the week underway, with Abbott Laboratories, Johnson & Johnson, Netflix, Pepsico, Schlumberger and United Airlines among the US non-financial highlights. The focus in reports will be on pricing power and margins, both tariff and consumer demand related, and how much uncertainty and policy ambiguity is restraining investment plans and labour demand, and whether this is impacting AI investments. For financials, most banks are expected to have benefited substantially from market volatility, though there may be more interest in the outlook for IPOs, new issuance and M&A.

In the commodities and energy space, there are OPEC’s monthly Oil Market, IGC Grains and NOPA crush reports, accompanied by Q2 production reports from Antofagasta, BHP, Rio Tinto and Santos.

– There are 37 S&P 500 companies reporting this week, with worldwide corporate earnings highlights as compiled by Bloomberg News likely to include: 3M, ABB, Abbott Laboratories, American Express, ASML, Assa Abloy, Atlas Copco, Axis Bank, Bank of America, Bank of New York Mellon, Blackrock, Charles Schwab, Cintas, Citigroup, Danske Bank, Disco, Elevance Health, Epiroc, Fastenal, Fifth Third, General Electric, Goldman Sachs, HCL Technologies, Huntington Bancshares, Interactive Brokers, Investor, Johnson & Johnson, JPMorgan Chase, JSW Steel, LM Ericsson, M&T Bank, Marsh & McLennan, Morgan Stanley, Netflix, Nordea Bank, Novartis, PepsiCo, PNC Financial Services, Progressive, Prologis, Saab, Sandvik, Schindler Holding, Schlumberger, Skandinaviska Enskilda Banken, State Street, Svenska Handelsbanken, Swedbank, TSMC Taiwan Semiconductor Manufacturing, Travelers, Truist Financial, United Airlines, US Bancorp, Volvo, Wal-Mart de Mexico, Wells Fargo.