The main events of a calm week on the economic calendar will be the release of U.S. inflation data and the start of the corporate earnings season.

Earnings season begins

Investors will be watching for indications of a potential economic slowdown as companies begin to report their fourth-quarter profits in the upcoming week.

Wells Fargo, Citigroup, Bank of America, and JPMorgan, as well as UnitedHealth Group, BlackRock, and Delta Air Lines all have reports due on Friday alone.

Refinitiv IBES expects that the S&P 500's Q4 profits will be 1.6% lower than they were in the same quarter last year. Some believe that considering the possibility of a recession, 2023 forecasts are still excessively optimistic.

If current profit expectations do not completely account for any economic slowdown, stocks may be more costly than they look, and any downturn may further reduce investor willingness to pay for stocks.

US CPI

On Thursday, the U.S. consumer price index for December is scheduled to be released. According to experts' predictions, core inflation rose 5.7% from a year earlier.

Any indication that price pressures are abating further may not only support the idea that the Fed is reaching the conclusion of its most ferociously tightening cycle in decades, but it may also fuel speculation that rates may be slashed later this year.

Data released by the United States on Friday revealed that December payroll growth exceeded expectations despite slower wage growth and weaker services activity, easing concerns about the direction of the Fed's monetary policy.

UK GDP

In the midst of double-digit inflation, unprecedented cost-of-living pressures, transport and public sector strikes, a cooling property market, and what is expected to be a protracted recession, the U.K. will reveal its November GDP data on Friday.

British mortgage approvals fell to their lowest level in November since the pandemic-induced fall of June 2020 following nine straight rate increases by the Bank of England, with more to come, according to the latest statistics.

Prime Minister Rishi Sunak has promised to halve inflation, expand the economy, lower public debt, and shorten waiting lists for healthcare services as pricing pressures and increasing borrowing costs hit.

Eurozone data

On Friday, Germany is scheduled to provide an estimate of its yearly GDP growth, which will illustrate how the energy crisis brought on by Russia's war in Ukraine has affected the largest economy in Europe.

The same day, statistics on industrial production and trade will be made available for the whole Eurozone. The high cost of energy imports has turned the bloc's trade balance from a surplus to a deficit, although the gap decreased in October as gas prices declined, and market observers will be checking to see if this pattern is maintained in November.

After declining in October, industrial production is anticipated to make a modest recovery.

(CNBC.com, investing.com, bloomberg.com)