Global market participants will enter a relatively short week that is\nnonetheless packed with important agenda items from the two largest\nworld economies: China and the United States. Investors will monitor the\nrelease of China\u2019s economic activity data at the start of the week as\nwell as the US Federal Reserve\u2019s interest rate decision scheduled for\nmid-week.<\/p>\n
This series of data releases is attracting attention because it\nprovides insight into the strength of China\u2019s economic recovery whilst\nalso indicating the direction of US monetary policy. The combination of\nthese two factors frequently determines sentiment for movements in\nglobal stock markets, exchange rates, and commodity prices.<\/p>\n
Financial market movements in the coming week have the potential to\nbe influenced by the realisation of these indicators, particularly in\ndetermining investor expectations regarding global economic growth and\nthe direction of US interest rates.<\/p>\n
China\u2019s Industrial Activity<\/p>\n
The global economic agenda will commence on Monday with the release\nof China\u2019s industrial production data for the January-February period.\nMarket consensus estimates that China\u2019s industrial production will grow\napproximately 5.0% year-on-year.<\/p>\n
Previously, according to the National Bureau of Statistics cited by\nTrading Economics, China\u2019s industrial production in December 2025 grew\n5.2% year-on-year, higher than the 4.8% increase in the previous month\nand exceeding market expectations which were in the region of 5.0%.<\/p>\n
This increase marked the fastest growth rate since September and was\nprimarily driven by strengthening activity in the manufacturing sector,\nwhich grew 5.7%, rising from 4.6% in November. The Chinese government\nhas indeed been pushing policy measures in recent months to strengthen\ndomestic demand to support economic growth.<\/p>\n
In addition to manufacturing, mining sector production also continued\nto show expansion of 5.4%, although it slowed slightly compared to 6.3%\nin the previous month. Meanwhile, electricity, heat, gas and water\nproduction grew 0.8%.<\/p>\n
More specifically, of the 41 major industrial sectors, 33 sectors\nrecorded growth. Several sectors with the strongest increases include\nthe computer and communications equipment industry which surged 11.8%,\nthe railway and shipbuilding industry at 9.2%, automotive at 8.3%, and\nchemical products at 8.0%.<\/p>\n
Throughout 2025, China\u2019s overall industrial production recorded\ngrowth of 5.9%, whilst on a monthly basis industrial output increased by\n0.49%.<\/p>\n
China\u2019s Domestic Consumption<\/p>\n
In addition to industrial activity, investors will also monitor\nChina\u2019s retail sales data, which is an important indicator of the state\nof domestic consumption.<\/p>\n
According to the National Bureau of Statistics cited by Trading\nEconomics, China\u2019s retail sales in December 2025 grew only 0.9%\nyear-on-year. This figure represents a slowdown compared to the 1.3%\nincrease in the previous month and fell below market expectations which\nanticipated growth of 1.2%.<\/p>\n
This growth marks the weakest performance since December 2022,\nreflecting pressure on household consumption which continues to be\naffected by relatively weak labour market conditions and a decline in\nproperty prices.<\/p>\n
By sector, the growth in sales of food and basic necessities slowed\nto 3.9% from the previous 6.1%. Clothing and textile sales also slowed\nto 0.6% compared to 3.5% in the previous month.<\/p>\n
Sales of traditional and modern pharmaceuticals recorded growth of\n1.2%, down from 4.9%, whilst sales of cultural and office supplies\nincreased 9.2%, although lower compared to 11.7% in November.<\/p>\n
On the other hand, sales of petroleum products and derivatives\ncontracted by 11%, a sharper decline compared to the 8% decrease in the\nprevious month. Several other sectors such as automobiles, household\nappliances, and tobacco and alcohol products also continued to record\ndeclines, albeit at more moderate contraction rates.<\/p>\n
On a monthly basis, China\u2019s retail sales fell 0.12%, although this\ndecline was smaller compared to the 0.41% contraction in the previous\nmonth.<\/p>\n
US Producer Price Pressure<\/p>\n
From the United States, market participants will monitor the release\nof the Producer Price Index (PPI) data for February scheduled for\nWednesday.<\/p>\n
According to the Bureau of Labor Statistics cited by Trading\nEconomics, producer prices in the United States previously rose 0.5% on\na monthly basis in January 2026. This figure was higher compared to the\n0.4% increase in the previous month and exceeded market expectations of\n0.3%.<\/p>\n
This increase was primarily driven by a surge in prices in the\nservices sector which rose 0.8%, marking the largest increase since\nJuly. One of the main drivers came from the margin increase in the\nprofessional and commercial equipment trading sector which surged\n14.4%.<\/p>\n
Prices also increased in several other categories such as clothing\nand footwear, chemical products, cable telecommunications services, and\nhealth and beauty retail sector.<\/p>\n
Conversely, goods prices actually fell 0.3%, the largest decline\nsince March 2025. This decline was primarily driven by a plunge in\npetrol prices of 5.5%. In addition, chicken egg prices, electricity,\nnatural gas fuel, fresh fruit and ethanol also experienced declines.<\/p>\n
On a year-on-year basis, producer prices in the United States\nrecorded an increase of 2.9%. Meanwhile, core producer inflation\nincreased 0.8% on a monthly basis, far above market expectations of\n0.3%.<\/p>\n
The Federal Reserve\u2019s Interest Rate Decision<\/p>\n
The main focus of market attention next week will be directed towards\nthe Federal Reserve\u2019s monetary policy decision scheduled for Thursday\nmorning in Indonesian time.<\/p>\n
According to the Federal Reserve cited by Trading Economics, the US\ncentral bank previously maintained interest rates in the target range of\n3.5% to 3.75% in its January 2026 meeting. This decision was in line\nwith market expectations following the Federal Reserve\u2019s three interest\nrate cuts throughout last year.<\/p>\n
Minutes from the Federal Open Market Committee (FOMC) meeting\nindicated<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/critical-data-from-the-us-and-china-key-market-sentiments-for-next-week-1773575506", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }