The USD surged higher at the start of this week as some positive US growth metrics from last week gives the Fed a green light to hike rates quickly. US retail sales, Industrial Production, and University Consumer Sentiment all bounced from recent lows. Remember, stocks can rise while interest rates increase as long as US growth remains strong. This makes US earnings very important. The shock drop in Netflix subscribers this week sent Netflix share price tumbling over 25% after hours. Expect earnings to stay in key focus now as investors weigh up whether the Fed’s fast hiking to control inflation ends up hindering growth. If investors worry about slowing growth then this week’s rally in stocks can quickly reverse.

Other key events from the past week

  • China: China growth worries, April 18: The long-term value for China’s 50 index remains, but investors are worried that Shanghai lockdowns will weigh on growth. China’s GDP came in at 4.8% y/y vs 4.0% expected this week in a more reassuring print, but the PBoC refrained from cutting rates on Wednesday.
  • CAD: Inflation surge, April 20: The surge in inflation to 6.7% last month shows that inflation pressures are more entrenched than the BoC thought from last week’s meeting. Will USDCAD see another leg lower next week?
  • Netflix: Hints of slowing growth? April 19: Netflix lost 200,000 subscribers in a shock drop in subscriber numbers for the first time in a decade. Is this a sign of pinched consumers starting to cut back on non-essentials? US growth and big-name earnings will remain a key focus for the rest of this month.

Key events for the coming week

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