Is the global economy really recovering?

Negative retail sales figures were released in the US last week, while the Bank of England (BoE) presented gloomy prospects for the UK economy's recovery, which forced investors to reconsider the recent optimism surrounding the global economy. Investors will now be eagerly looking towards next week's releases for further signs of economic recovery.

In the UK, investors will focus on the Gross Domestic Product figures that will be released at the end of the week. After the BoE's inflation report, no major changes are expected from last month's figures.

Another important data release will be the inflation figures for April which are scheduled to hit the wires on Tuesday. Here, the year-on-year figure is expected to have declined to 2.4%, from 2.9% in March.

British consumer expenditure will be gauged through the retail sales figures. Among other releases this week, the minutes of the last BoE rate-setting meeting held on May 7 will also be worth reading.

In the eurozone, the release of Purchasing Managers Index (PMI) figures will provide markets with a view of the manufacturing and services sectors. These are both expected to show an improvement from last month's readings. However, they are still expected to be below the 50 mark which divides growth from contraction.

Construction output during March and trade balance figures will wrap up the week in the eurozone.

In the US, investors will be able to judge the health of the housing market through the release of figures on housing starts, building permits, the Housing Market index and the MBA Mortgage Applications figures, all of which will be released in the first half of the week.

Initial Jobless and Continuing Claims statistics will provide insight into the state of the labour market, and there will also be an indication of the level of consumer confidence in the world's largest economy.

Finally, the minutes of the Federal Open Market committee meeting held on April 29 will also be released.

This article has been prepared by Bank of Valletta plc, which is licensed to conduct investment services business by the MFSA, for your general information only. This information is not a solicitation or offer by the bank to acquire or sell securities, nor does it constitute any form of advice by the bank. Appropriate advice should be obtained before making any such decision. Past performance is not necessarily a guide to future performance and the value of your investments may fall or rise.