Investing.com - The last full trading week of 2019 looks set to be an exciting one with the trade roller-coaster still not over despite the announcement of a “phase-one” deal between the U.S. and China. The Brexit process could final get underway after a landslide victory for British Prime Minister Boris Johnson’s Conservative Party and Thursday’s Bank of England policy announcement may give investors more clarity on its view of the economy. Appearances by Federal Reserve officials and updates on the U.S. and euro zone economies round out the calendar. Here’s what you need to know to start your week.
- Trade deal rollercoaster ride to continue
China said Sunday it has suspended additional tariffs on some U.S. goods that were meant to be implemented on Dec. 15 after the world's two largest economies agreed a "phase one" trade deal on Friday.
The deal, rumors and leaks over which have whipsawed global markets for months, reduces some U.S. tariffs in exchange for what U.S. officials said would be a big jump in Chinese purchases of American farm products and other goods. But neither side has offered specific details on the amount of U.S. agricultural goods Beijing had agreed to buy.
And while U.S President Donald Trump announced that "phase two" trade talks would start immediately, Beijing made it clear that moving to the next stage of the trade negotiations would depend on implementing phase one first.
- Brexit fog to lift?
The sweeping election victory by Prime Minister Boris Johnson’s Conservative Party has paved the way for Britain to leave the EU on Jan. 31. That process could begin after the state opening of the parliament with the Queen’s Speech on Thursday. The Queen's Speech is used to detail all the bills the government plans to enact over the coming year.
British Cabinet Office Minister Michael Gove said on Sunday that the top priority of the government is to leave the European Union on Jan. 31 and secure a new trade deal with the EU by the end of next year.
Meanwhile, on Thursday the BoE will have its first chance to give its view on the post-election landscape. Investors will be watching out for any shifts in its views on inflation, the UK economy and the interest rate outlook for 2020.
- Fed speakers
Investors will be looking ahead to remarks from several Fed officials in the coming days after the U.S. central bank voted unanimously to hold rates steady last week and signaled that they can remain on hold through 2020. Fed Chair Jerome Powell said the banks view of the economy remains favorable.
Dallas Fed President Robert Kaplan, New York Fed President John {{ecl-1585||Williams and Eric Rosengren of the Boston Fed are all due to speak on Tuesday, while Chicago Fed President Charles Evans is scheduled to speak a day later.
- U.S. Economic data
The U.S. economic calendar includes updates on industrial production, housing, consumer sentiment, personal income and spending and another look at third quarter GDP.
“The narrative is likely to continue to be one of manufacturing in recession as a result of the uncertainty caused by trade wars in combination with weak global demand and a strong dollar, although the return to work of 50,000 or so General Motors (NYSE:GM) workers after the conclusion of their recent strike action will lead to a rebound in auto manufacturing output,” analysts at ING said.
- Can Germany avoid Q4 recession?
First clues as to whether the euro zone’s largest economy Germany can avoid a fourth quarter recession emerge on Monday when advance PMI readings for November are released.
The economic activity surveys, a key barometer of economic health, come after Citi's economic surprise index showed euro zone economic data beating consensus expectations at the fastest pace since February 2018. The latest surprise was a 1.2% rise in German exports in October, defying forecasts of a contraction.
Hopes are high that exports and private consumption, which helped Germany skirt recession, will hold up. Last month's PMI data showed manufacturing remained in deep contraction across the bloc.
--Reuters contributed to this report