It’s an Anglo childhood story we all know, on the Pied Piper of Hamelin.

To "Pay the Piper" means to face the inevitable consequences of one's actions, possibly alluding to the story where the Hamelin villagers broke their promise to pay the piper for his assistance in ridding their town of its hideous rats.

President Trump’s former economics advisor Gary Cohn thought the Trade Wars held back the U.S. economy’s growth rate. His tax cut play would have worked up better GDP growth without that headwind.

Gary may have been dead wrong on that. The Trade Wars built up a huge quarterly sequence of inventory accumulation numbers last year. These supported GDP growth… LAST year.

Here’s the rub:

Want to know what GDPNow at the Atlanta Fed currently shows for Q1-2019? A paltry +0.3%

Does inventory overshoot inside topline 2018 GDP growth deliver inventory problems in 2019? Will this sideswipe the U.S. economy going forward?
 

• What’s the broad reality? The economist consensus shows less U.S. GDP growth this year than last. Regardless of trade inventory accumulations.
• Economists offer up a big mouthful — on any accumulation & decumulation phenomenon seen across a period of time. These are ‘an inter-temporal transfer of growth.’
• That low first quarter GDP growth print could also just be a winter number (with added Federal Shutdown issues).

On one point, there is no doubt: partisan political rhetoric will wash around and over this and other quarterly 2019 prints in the pipeline.

We shall see. What actually happens to GDP growth data as the New Year progresses?

In the Global Week Ahead, the U.S. has the leading hand — in terms of supplying global markets with key fundamental data.
 

• On Friday, Federal nonfarm payrolls, the household unemployment rate and wage growth figures are due out for February.
• In advance of that, the ADP private payrolls get released on Wednesday.
• Advance estimates are at +170K for the ADP and +150K for the Federal counts, respectively.

Next are five big Reuters’ themes.

These are the ones likely to dominate the thinking of investors and traders in the coming Global Week Ahead.

(1) No March 29th Brexit?

It was a bit of a U-turn by UK Prime Minister Theresa May when she signaled readiness to allow Brexit to be delayed a few months beyond the March 29 deadline to ensure Britain doesn’t crash out of the EU without a trade deal.

A “meaningful” vote on the arrangement Theresa May negotiated with Brussels will be held by March 12th in parliament.

And in another U-turn of sorts: opposition leader Jeremy Corbyn has backed holding another referendum, the first time he has endorsed giving voters a chance to change their mind. With no-deal Brexit looking less likely, sterling has posted two straight weeks of one percent-plus gains against the dollar.

So do interest rate rises come back into the equation?

Markets seem to think so — 10-year British government bond yields have risen 15 basis points in the past week. UK inflation is at two-year lows, though Bank of England policymakers have noted rising inflation expectations — one survey shows those at 5-year highs. Wage growth, too, is the fastest in a decade and job creation is strong, possibly as companies cut machinery purchases before Brexit.

So money markets now reckon there is a 62 percent chance of a rate rise by the end of 2019, up from 30 percent in mid-February. Another U-turn?

(2) A China Trade Deal Announced Soon?

He’s walked away from a deal with North Korea, yet no one seriously believes U.S. President Donald Trump will walk away from a trade deal with China, given how much is at stake for the world’s two biggest economies and their leaders.

Chinese stock markets are celebrating both — the news of a delay in higher U.S. import tariffs and hopes that trade talks will bear fruit.

After all, Trump’s economic advisor Larry Kudlow has touted “fantastic” progress on the talks.

For Chinese markets, the calendar is looking busy. Trade aside — and a possible meeting between Trump and Chinese counterpart Xi Jinping — China's parliament kicks off its annual meeting on March 5. Growth-boosting measures such as tax cuts may be rolled out, alongside laws banning forced technology transfer and government "interference" in foreign business practices — a nod to those accusing Beijing of intellectual property theft.

Finally, we will get the latest data slice on the state of China's exports and imports.That should show how much damage the U.S. onslaught has caused so far.

(3) On Thursday, March 7th, Will There Be More ECB Stimulus?

There’s palpable excitement about the prospect of another round of Eurozone stimulus ahead of the ECB’s March 7 meeting.

Most expect the bank to at least drop hints that cheap bank loans are imminent; failure to do so could put European bank stocks and Italian government bonds in the firing line.

But it’s shaping up to be an interesting meeting for other reasons, too. The ECB will release economic projections, a day after the OECD does so. Downward revisions appear likely, given that heavyweight Germany is struggling and Italy is in recession. But with most recent indicators suggesting a growth pick-up later this year, the forecasts may provide a clearer idea of the ECB’s reading on the economy.

The guidance that rates are on hold through the summer is unlikely to change, judging by remarks from future ECB chief economist Philip Lane and Bundesbank chief Jens Weidmann, who is a potential candidate as next ECB head. Investors will be looking for any sense of where the succession question stands. In short, there are great expectations and the risk is they may be disappointed.

(4) Out on Friday, the U.S. Non-Farm Jobs Report

The February employment report, due on Friday March 8, could affirm the Fed’s significant flexibility to be patient with future interest rate hikes.

The U.S. economy continues to add jobs while inflation remains very low. It added 304,000 non-farm payrolls in the first month of 2019, compared to consensus expectations of 165,000. But here’s the rub — average hourly earnings rose just 0.1 percent in January over December, the slowest climb since October 2017. That’s important because hourly earnings are watched as a key inflation gauge.

The Fed's January policy statement noted "muted" inflation pressures. More recently Fed officials say that while it's close to meeting its goals of full employment and 2 percent inflation, rising pay shows no sign of translating into price increases.

(5) Turkey’s Central Bank in Focus

Decision time is coming up at Turkey’s central bank. It’s expected to hold its main interest rate at 24 percent on Wednesday.

But the trajectory in coming months hinges to a high degree on inflation — data on Monday is expected to show February price growth at 19.9 percent, down a touch from January’s 20.35 percent.

With inflation grinding lower as the economy adjusts after last year’s currency crisis, an interest cut is on the cards sooner rather than later.

Adding to the momentum is President Tayyip Erdogan, a vocal supporter of lower interest rates. That’s especially so given Turkey’s local elections are just a month away and support for Erdogan’s AK Party has been eroded by the economic pressures. Pollsters predict that votes in Ankara and Istanbul will be on a knife edge. To ease consumer price pressures, the government has launched the sale of cheap vegetables in both cities.

Investors will be waiting to see if governor Murat Cetinkaya drops any hints on when rate cuts could begin.

Top Zacks Rank Stocks—

Let’s look into ‘fashionable’ stocks this week…

Boeing (BA Quick QuoteBA - Free Report) : How much higher can this DJIA darling stock go? It’s at $440 now. The Zacks Rank is indeed a #1. But The Value score is D. I would look elsewhere. But I am not a momentum chaser.

Starbucks (SBUX Quick QuoteSBUX - Free Report) : Here’s another overpriced ‘fashionable’ stock currently on our Zacks #1 Rank list. This one trades at $71 a share. The Zacks Value score is D.

WPP (WPP Quick QuoteWPP - Free Report) : I don’t see this name on the Zacks #1 Rank list much. It is a global Advertising and Marketing stock with a Market Cap of $13.9B. This also has a Zacks long-term VGM of A. That is very attractive.

Key Global Macro—

On Monday, Turkey’s CPI comes out. The y/y rate is at +20.35%. Yikes!

Mexico’s leading indicators look soft. The prior reading was -0.08. The new one out today could be -0.10.

On Tuesday, Australia’s Reserve Bank (the RBA) will offer up its policy overnight rate. It’s at a 1.5% level. There has been stress there.

India and Russia PMIs come out. The India composite has been 53.6. The Russia composite has been 53.6, too.

The ISM non-manufacturing index for the USA also comes out. It should be great at 58.0.

On Wednesday, the ADP employment survey should show 170K jobs added last month, down from 213K the month before. That is still a sound performance.

The Bank of Canada offers up a new Base Rate. It’s at 1.75% now.

On Thursday, there’s an ECB policy meeting in Frankfurt. The Deposit Rate is -0.4% and the Main Refi Rate is 0.0%.
Eurozone GDP growth also comes out. It has been a paltry +1.2% y/y.

On Friday, the Fed’s Powell speaks at Stanford.
U.S. Housing Starts (1.078M) and Building Permits (1,326M) come out.

The U.S. Household Unemployment Rate should be 4.0% and Payroll Additions should be +150K.