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Insights into economic growth in the first quarter will be the highlights of the coming week, as both the US and eurozone publish advance GDP estimates.

The US economy is expected to have slowed slightly from the 2.6% annual rate of increase seen in the fourth quarter, with the consensus at 2.0% and our tracker at 1.9%. However, some nowcast estimates hint at growth holding steady, and recent PMI data have surprised to the upside. The GDP release is accompanied by important inflation data in the form of PCE updates, which are expected to show the core annual rate of inflation - favored by the FOMC - slowing from 4.2% to 4.0% according to consensus, though there could be some uplift evident in the March print.

Also watch out for US consumer sentiment data from the University of Michigan and Conference Board, the former's preliminary release having shown a welcome upturn, as well as durable goods orders and a raft of housing data.

In the eurozone, it won't take much for the GDP data to improve on the flat picture seen in the closing quarter of last year, and surveys such as the PMI have fueled speculation that the pace of expansion has picked up despite rising interest rates, thanks in part to reduced energy concerns. We are pencilling-in modest growth with an expectation that the upturn should gather some momentum in 2023 in response to the easing cost of living squeeze. First quarter GDP data are also published for Germany, France, Italy, and Spain. European CPIs and consumer confidence numbers are also updated, helping gauge the cost-of-living crisis.

In APAC, we pick South Korean GDP and Taiwan's industrial production numbers as key statistics to watch, as these provide bellwethers to the region's broader economic performance. Also look out for inflation numbers in Australia, mainland China profits data and Japan's updates to industrial production, retail sales and unemployment.

From a central bank perspective, Sweden's Riksbank is expected by many to hike by 50 basis points to further tame inflation, despite the government forecasting a deeper economic downturn this year. It's a very different picture at the Bank of Japan, where new governor Kazuo Ueda has pledged to keep policy ultra loose, at least for the near-term, as inflation is set to drop hit the 2% target later this year.

Sustainability in question

The April flash PMI data published on 21st April by S&P Global point to faster economic growth across the four major developed economies at the start of the second quarter. The data alleviate concerns over imminent global recession risks.

However, there is evidence that the upturn appears to be highly concentrated not just in services but in certain areas of the services economy, namely consumer services and financial services. This reflects a likely tailwind from the pandemic as spending moves from goods to services, as well as some easing of financial conditions after the tightness seen late last year. These factors are likely to act as diminishing drivers of growth as we head through the year, especially as higher interest rates take their toll.

In manufacturing, weak demand for goods is widespread with the exception of the US, where there is evidence that the inventory adjustment is more advanced than elsewhere, meaning destocking is acting as less of a drag. Once inventories are normalized elsewhere, demand will recover somewhat, but it remains to be seen how adversely affected demand will be from other factors, such as the increased cost of living and higher interest rates.

We therefore retain the impression from the data that, while recession appears to have been averted for now, there remains a strong possibility of substantially weaker economic growth later in the year as the lagged impact of higher interest rates feeds through to the economy (see chart), at the same time that the cost-of-living crisis has eroded real incomes. (For more detail, read our special report on page 4).

Key diary events

Monday 24 April

Singapore CPI (Mar)

Germany Business Expectations (Apr)

Hong Kong Unemployment Rate (Mar)

United States Chicago Fed National Activity (Mar)

Tuesday 25 April

Australia & New Zealand Market Holiday

United Kingdom Public Sector Net Borrowing (Mar)

Hong Kong Exports & Imports (Mar)

Brazil Retail Sales (Feb)

United States House Price Index (Feb)

United States CB Consumer Confidence (Apr)

Korea Consumer Confidence (Apr)

Wednesday 26 April

New Zealand Trade Balance (Mar)

Australia CPI (Q1)

Singapore Industrial Production (Mar)

France Consumer Confidence (Apr)

Brazil Bank Lending (Mar)

United Kingdom Labour Productivity (Q4)

Thursday 27 April

South Africa Market Holiday

New Zealand Business Confidence (Apr)

Australia Export & Import Price Index (Q1)

Italy Business Confidence (Apr)

Portugal Business Confidence (Apr)

Europe Business and Consumer Survey (Apr)

Brazil Service Sector Growth (Feb)

United States GDP (Q1)

United States Real Consumer Spending (Q1)

Friday 28 April

Japan CPI (Apr)

Japan Unemployment Rate (Mar)

Japan Industrial Production (Mar)

Japan Retail Sales (Mar)

Australia PPI (Q1)

Japan BoJ Interest Rate Decision

French GDP (Q1)

Germany GDP (Q1)

France CPI & PPI (Apr)

Spain CPI (Apr)

Spain GDP (Q1)

Italy GDP (Q1)

Portugal CPI (Apr)

Portugal GDP (Q1)

Europe GDP (Q1)

Germany CPI (Apr)

Brazil Unemployment Rate

Canada GDP (Feb)

* Press releases of indices produced by S&P Global and relevant sponsors can be found here.

What to watch

Americas: US GDP, consumer spending and confidence, house price data, Canada GDP and Brazil service sector data, unemployment rate and retail sales

GDP and consumer spending and confidence data will be due from the US in the coming week. Supported by consumer spending, the US economy has faired well in the last couple of months, with the service sector leading growth according to the PMI surveys. Figures released in the following week will confirm the growth seen. Canada's GDP for February is also due.

In Brazil, service sector and retail sales data, and the unemployment rate will provide an indication of the current trends in the economy.

Europe: GDP, CPI, trade data and consumer confidence

GDP figures for Q1 and April's CPI data will be released for many of the European countries including Germany, France, Spain, Portugal and Italy. While inflation is coming off the recent post-pandemic highs, it remains stubbornly elevated, and the latest figures will help decipher if the downward trajectory has been maintained. Additionally, business confidence data from France, Italy and Portugal will offer insights into current market sentiment.

In the UK, key releases to watch out for will be public sector net borrowing and labour productivity data.

Asia-Pacific: Japan CPI, unemployment rate, industrial production and retail sales figures, followed by the BoJ meeting. New Zealand to release business confidence data. Australia CPI, PPI and trade numbers

Key sets of data to be released from Japan include CPI, unemployment rate, industrial production and retail sales figures. These will be followed with the central bank meeting. While Japan's inflation rate has been above the 2% target, official figures report some easing and the bank has committed itself to extending its ultra loose policy for the near term.

Elsewhere, New Zealand will publish business confidence data. Next door, CPI, PPI, and export and import prices figures from Australia will also be keenly awaited.

Special reports:

Flash PMI data signal fastest developed world growth for 11 months, price pressures rise further - Chris Williamson

Philippines on Track to Become One Trillion Dollar Economy by 2033 - Rajiv Biswas

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Purchasing Managers' Index™ (PMI^®) data are compiled by S&P Global 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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This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.