The following is an extract from IHS Markit's latest Week Ahead Economic Preview. For the full report, please click on the 'Download Full Report' link

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• Worldwide manufacturing and service sector PMI surveys, ISM US surveys
• US nonfarm payrolls
• RBA rate setting meeting

The economic diary for the coming week kicks off with global PMI surveys and concludes with US non-farm payrolls, interspersed with official releases including a variety of GDP, production and inflation reports plus the RBA rate setters' meeting.

The release of worldwide PMI surveys will provide an early snapshot into economic growth and inflation trends midway through the first quarter. Flash February data hinted at the strongest developed market expansion for three years, led by the US, which has contributed to further upward revisions to many forecasters' expectations for worldwide GDP in 2021.

Even in countries such as Japan, the UK and Eurozone, where COVID-19 containment measures have been tightened again this year, economies seem to be faring better than last year due in part to a revival in manufacturing, which has helped cushion the economic impact of further virus waves. Rising global trade has also boosted many Asian economies ( see special report).

However, the growth spurt is being accompanied by rising prices, notably for industrial goods, due to near-record supply chain delays. These delays and price hikes are linked to demand exceeding supply as economic recoveries take hold. Insight from the PMIs will therefore be sought into the extent to which these inflationary pressures are developing, and if they might be spilling over to the service sector, which would augur for a potentially bigger impact on the longer term inflationary picture.

The spectre of inflation has continued to rattle bond markets, and higher yields have the potential to cause problems for policymakers eager to keep borrowing costs low. The focus this week turns to the Reserve Bank of Australia's policy decision. Markets will be looking for any signs that the central bank could be wavering from its commitment to keeping the policy rate low for several years despite recent signs of sharply rising price pressures and solid economic growth.

The performance of the US economy will also be gauged by updates to the ISM surveys and the labour market, with nonfarm payrolls expected to rise by 110k - an improvement on the disappointing 49k increase seen in January but still indicative of a weak job market recovery, underscoring the deep scars left by the pandemic on sectors such as retail and hospitality.

The week also sees fourth quarter GDP updates for Australia, Brazil, Canada, the Czech Republic, Italy and South Korea.

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PMI commentary: Chris Williamson

Europe commentary: Ken Wattret

APAC commentary: Rajiv Biswas

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Purchasing Managers' Index™ (PMI™) data are compiled by IHS Markit for more than 40 economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies, and are available only via subscription. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment and inventories. The PMI data are used by financial and corporate professionals to better understand where economies and markets are headed, and to uncover opportunities.

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