Can we afford to be more optimistic about the future? The next seven days start on a more positive note for global geopolitics with a visit by NATO Secretary General Jens Stoltenberg to South Korea and Japan.
He will travel from Seoul to Tokyo on Monday to strengthen the transatlantic security alliance’s ties with its key partners in Asia. The meetings, which follow the participation of Japan and South Korea for the first time in NATO’s European summits, demonstrate the alliance’s support for these countries in the face of security challenges posed by China and North Korea.
The war in Ukraine will be high on the agenda, with Tokyo and Seoul likely to confirm the launch of additional non-lethal equipment for Kyiv.
On the other hand, this week will also provide reminders of the ongoing and very real challenge posed by populism and nationalists. India marks Martyrs’ Day on Monday on the 75th anniversary of Mahatma Gandhi’s assassination. As writer Ramachandra Guha points out in his essay FT Weekend, reverence for the anti-colonial revolutionary has waned as Hindu nationalism has risen.
In the United States, the figure of former President Donald Trump will once again gain prominence, since his adviser Peter Navarro will be tried on Monday for failing to comply with a subpoena from the House committee that investigated the attack on the Capitol on January 6, 2021.
In the UK it’s yet another week of strikes, starting Monday with driving instructors at the Driver and Vehicle Standards Agency. The biggest day of action will be Wednesday, when schoolteachers, train conductors and university professors put down their tools as the union body TUC organizes a Day to Protect the Right to Strike in opposition to a controversial bill from the government to stop the strike in essential services.
The rate-setting schedules have been realigned for the monetary policy committees of the Federal Reserve, the European Central Bank, and the Bank of England.
The ECB is expected to stick with extra-large rate hikes while the Fed cuts rates, having signaled it would end its pace of 0.75 percentage point hikes in December.
The Bank of England is expected to push for a 0.5 percentage point rise, due to stubbornly high inflation, strong wage growth and the unexpected resilience of the UK economy.
We are in the middle of earnings season and this week is the peak of Big Tech with quarterly numbers from Alphabet, Amazon.com, Apple, Meta and Spotify. It’s been a sobering moment for the industry, especially the admission that they overhired during the Zoom years of the pandemic.
Apple will stand out as it is expected to break a 14-quarter growth streak in the lucrative December period due to a shortage of high-end iPhones. The culprit is a November outbreak of Covid-19 at the Zhengzhou factory (locally known as iPhone City), creating a mobile phone shortage of between 5 and 10 million units.
Costing around $1,000 each, this works out at a $10 billion setback, and it’s not good news for Apple given its phone war with Google. Revenue this quarter in 2021 was a nudge below $124 billion; forecasts are slightly lower for 2022, but the impact on net profit could be higher.
Read the full schedule for next week here.