Key events in EMEA and Latam next week

Industrial production should recover from 2.8% in December to 5.5% year-on-year in January; the disappointment in December was largely related to the construction sector, which plays a minor role in both January and February. Exports maintained a decent performance. Retail sales should also rebound from 4.7% to 8.0% YoY; the December reading was dragged down by clothing (due to weather effects) and food sales. Both categories should recover in January while demand for durable goods should remain solid.

Labour market data should also paint a positive picture. We expect an increase in wages from 6.1% to 7.3% YoY; the December reading was reduced due to a smaller contribution from the mining sector. Also, the minimal wage hike in January should add approximately 0.4 percentage points to the headline figure. Enterprise employment is likely to be lower when compared to previous years but a rapid drop reflects a statistical anomaly rather than a structural change. Each year the statistical office rebalances the panel of enterprises adding new companies to the sample. In 2018, such a procedure resulted in an abnormal increase in employment, which likely won't repeat this year.