The following is an extract from IHS Markit's latest Week Ahead Economic Preview. For the full report (including Special Reports) please click on the link at the bottom of the article.

• UK faces Brexit Day at end of week
• FOMC and BoE decide monetary policy
• US and Eurozone GDP
• Bank of Japan document eyed for future policy changes

A week which sees the UK leaves the European Union is also packed with policy action from the Fed and the Bank of England, alongside GDP updates from major economies.

Brexit is high on the list of global concerns. Increasing market jitters are expected as Brexit Day approaches at the end of the week, with analysts assessing the ability of the UK government to make trade deals with the EU before the transition period runs out at the end of the year. The Bank of England also meets in the week, and prospects of a rate cut hinge on British economic performance at the start of the year.

In the US, where Fed policymakers meet during the week, the FOMC looks set to continue sitting on its hands for an extended period barring any material changes to the outlook. Nonetheless, rhetoric from the press conference will be scrutinised by analysts for clues as to future policy direction. Meanwhile fourth quarter GDP update will be in focus as well, with expectations of steady growth during the closing quarter of last year.

In the eurozone, updated GDP figures will likely provide confirmation to expectations of subdued growth. The December PMI surveys showed that the European economy closed out 2019 in its worst spell since 2013, with near-stagnant demand and gloomy prospects likely extending into the new year.

In Asia Pacific, BoJ summary of opinions will be scrutinised for clues of the likelihood of tighter monetary policy following growth forecast upgrades at the recent policy meeting. India's 2020 budget will also be watched closely for any announcements of fiscal measures amid a growth slowdown, while an updated official estimate of FY19/20 GDP projection will be eagerly anticipated. Meanwhile, China's government-sponsored PMI figures would provide clues as to whether recent manufacturing recovery had gained pace.

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PMI commentary: Chris Williamson

Europe commentary: Ken Wattret

APAC commentary: Rajiv Biswas and Bernard Aw

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Posted 24 January 2020 by Bernard Aw, Principal Economist, Economic Indices, IHS Markit

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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