On Wednesday Fed chairman Ben Bernanke will be giving one of his two speeches a year on monetary policy and the state of the economy in Washington DC. He will begin speaking at 3pm UK time and the market will be looking for any further explanation of last Thursday's move as well as indications that policy will be tightened further.
The recent flurry of communications from the Fed has already provided a very good insight into the likely contents of Bernanke’s testimony so the questions and answer session should be make for more interesting watching.
The big release to look out for in the UK this week is the final fourth quarter GDP data on Friday. Most economists are expecting an upward revision to 0.2 per cent (from 0.1) given the stronger than anticipated performance of industrial production in December but downside risks still remain.
While retail sales were strong over Christmas, the high street has been struggling so far this year. The CBI releases its monthly distributive trades survey which assesses the state of the retail sector in February. It is likely to show a rebound after a very weak January but analysts warn that this may be a one-off and not to place too much weight on a strong figure.
Nationwide is also due to announce its house price index for February at some point during the week – likely Thursday – and it is expected that the annual change will hit double digits despite a slower pace of growth.
In the US, we’ll see December’s Case-Shiller home price index on Tuesday as well as February consumer confidence. The second estimate of US fourth quarter GDP data is due out on Friday and economists are on average expecting no revisions.