WHAT ALL TO WATCH THIS WEEK?

Fed decision

The Fed is expected to raise interest rates by another 25 basis points on Wednesday amid persistent inflation and growing concerns about the economic outlook.

It would be the tenth rate hike in a row, bringing the benchmark rate into the 5% to 5.25% range, its highest level since 2007. While price pressures are cooling, inflation is still well above the Fed's annual target of 2%.

Fed officials and markets remain divided on the future path of interest rates, with the central bank expecting rates to remain at current levels until 2023 and investors betting on a rate cut before the end of the year.

Given renewed signs of stress in the banking sector in recent days, with the problems at First Republic Bank, Fed officials may signal a pause in June.

Fed monetary policy makers have indicated that tighter credit conditions could act as an additional rate hike, which could reduce the number of hikes needed to bring inflation down to its target level.

US jobs report

On Friday, the April jobs report will be released in the United States, which is expected to show that the economy created 180,000 new jobs. While this is still a solid number, it would mark the third consecutive month of modest job growth.

The unemployment rate is expected to rise to 3.6%, while average hourly earnings are expected to remain stable.

Last week's data showed that growth slowed more than expected in the first quarter, so the employment report will be closely watched to show how well the labor market is holding up to demand.

The economic calendar also includes March job openings data, initial jobless claims (which are starting to rise), and the ISM purchasing managers' surveys of the manufacturing and service sectors for April.

Economic results

Apple $AAPL, the largest U.S. company by market value at $2.6 trillion, will report its earnings results on Thursday, and analysts expect second fiscal quarter revenue to fall to $93 billion and earnings per share to reach $1.43.

Apple's report is an indicator of global consumer demand, and its results may ripple through markets given its importance to several industries.

Overall, the first quarter results are better than feared. First-quarter earnings were down 1.9% from a year earlier, according to Refinitiv, which has released data for slightly more than half of the S&P 500. That's a smaller drop than the 5.1% decline expected in early April.

Other major companies reporting in the coming week include Ford $F, Starbucks $SBUX, Advanced Micro Devices $AMD, Kraft Heinz $KHC, Modern $MRNA, Pfizer $PFE and Uber Technologies $UBER.

ECB rate hike

Source.

The European Central Bank is set to raise interest rates again on Thursday, by both 25 basis points and 50 basis points. Tuesday's inflation and bank lending data in the eurozone will tip the scales.

April's consumer price inflation data is likely to confirm that underlying price pressures, which are above 5%, remain uncomfortably high. This would underline the arguments in favour of a more significant rate hike.

However, if bank lending data showed that credit conditions had tightened significantly, this would support the case for a smaller rate hike.