US and UK to Release GDP; Fed and BOJ to Meet – Wall Street Journal

April 24, 2016 3:00 p.m. ET

This week, data releases from the U.S., U.K. and Japan will help give a read on where the global economy stands, and the Federal Reserve and Bank of Japan are meeting to set monetary policy.

BREXIT: In two months, U.K. voters will decide whether to remain in the European Union. Some economists fear that uncertainty radiating from this debate could already be damaging the British economy. On Wednesday, we get the first look at U.K. GDP in the first three months of 2016. Here's what to worry about:

• Almost half of Britain's exports go to the EU. Will there be signs of any pullback in trade between the U.K. and the rest of Europe with the future of their alliance uncertain?
• U.S. companies use the U.K. as their gateway into Europe, and the rest of the EU is the largest source of inward investment to the U.K. Will multinational corporations scale back investment in the U.K. if this gateway is at risk of closing?
• The U.K. government has warned its economy could shrink as much as 6% by 2030 if Brexit happens. That would be equivalent to the amount U.K. GDP shrank during the global financial crisis.

U.S. GROWTH: The first estimate of U.S. economic growth in 2016, due Thursday, will help make sense of mixed data. GDP is expected to be dismal, but just how weak could make all the difference. Many are watching forecasts from real-time economy trackers at the New York Fed and Atlanta Fed that peg growth at barely positive rates of 0.8% and 0.3%, respectively.

FOMC TIME: The Federal Reserve meets Tuesday and Wednesday and is expected to keep rates unchanged. The focus will be on whether its statement sends a signal about the possibility of a rate increase in June.

ABENOMICS: Some observers are writing obituaries for Abenomics, the growth program of Japanese Prime Minster Shinzo Abe. On Thursday, reports on industrial output, inflation and retail sales could be pivotal in determining if that eulogizing is premature. Later in the day, the Bank of Japan will release its latest monetary policy decision. Many expect further stimulus from Japan's central bank, but the BOJ has brought on domestic backlash over its foray into negative rates and has drawn international scrutiny over comments that the yen's appreciation has been "excessive."