In addition to developments in the Greenland conflict, the focus of the new trading week will be on the US Federal Reserve's (Fed) interest rate decision in the middle of the week. It is also important to keep an eye on important economic data from time to time. The reporting season, which continues to gather pace, is also likely to provide momentum when major US companies present their figures.
Despite easing of tensions in Greenland: uncertainty likely to remain simmering
The Greenland conflict is likely to continue to concern investors despite the recent easing of tensions. At the World Economic Forum in Davos last Wednesday, US President Donald Trump ruled out military means to take over the Arctic island and also backed down on the threat of extra tariffs against the Federal Republic of Germany and other NATO countries. Special tariffs of 10 percent on imports into the USA from February 1 were actually being considered if no agreement was reached on the purchase of Greenland. According to Trump, however, a „framework for a future agreement“ on security in the Arctic has been agreed with NATO Secretary General Mark Rutte.
Economic data in focus - US Federal Reserve could keep its feet still on Wednesday
This afternoon, for example, new orders for durable goods are on the agenda (14:30).
Consequently, market players are likely to focus their attention on the Fed's key interest rate decision on Wednesday evening (20:00). The FOMC press conference with Fed Chairman Jerome Powell will also be monitored for monetary policy clues (20:30).
It remains doubtful that the US monetary authority will turn the interest rate screws. According to the CME Group's „Fed Watch Tool“, 97.2% of market participants currently expect a pause in interest rates and only 2.8% expect a rate cut of a quarter of a percentage point. The interest rate band itself currently stands at 3.50 to 3.75 percent.
The ongoing discussions surrounding Jerome Powell's successor could also provide food for thought. His term of office as Fed Chairman officially ends at the end of May. However, US President Donald Trump has repeatedly clashed with Powell in the recent past, raising doubts about the independence of the monetary watchdog. Possible successor candidates include Kevin Hasset, Kevin Warsh and Fed Director Christopher Waller.
On Friday, it is also important to keep an eye on US producer prices, which could also provide monetary policy signals (14:30).
US reporting season continues: tech heavyweights in focus
On Tuesday, for example, the focus will be on the figures for the past financial quarter from General Motors (ISIN: US37045V1008), on Wednesday from Meta Platforms (ISIN: US30303M1027), Microsoft (ISIN: US5949181045) and Tesla (ISIN: US88160R1014) and on Thursday from Amazon (US0231351067) and MicroStrategy (US5949724083).
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