By Philip Blenkinsop
BRUSSELS, Jan 12 (Reuters) - Year-end U.S. shopping and manufacturing output figures and a Friday credit-rating blitz in Europe are expected to set the tone this week, showing the global economy's uneven recovery remains on track.
Last week ended on a jarring note, with data showing U.S. employers hired the fewest number of workers in almost three years in December.
However, heavy snow and a record cold snap gripping the East and Midwest since mid-December probably played a role in the figures, which were at odds with recent consumer spending, trade and production numbers that suggested a strong end to 2013.
The big economic question is whether the Federal Reserve will decide to reduce its monthly bond-buying by $10 billion for a second time at its next meeting on January 28-29.
After the employment data raised doubts, economists will seek assurances from retail sales in the busy Christmas month on Tuesday and December industrial output on Friday.
"We're becoming more upbeat, we're pushing towards 3 percent GDP growth this year," said ING senior economist James Knightly. "It's a more encouraging story, a broadening out of the recovery and we suggest next week's numbers are going to underline that."
The week's releases also include U.S. consumer inflation from December, seen marginally higher than in November, but still modest at 1.5 percent year-on-year.
The Fed's top officials have stressed that further scaling back of the bond-buying stimulus is a delicate path and will depend on progress in the labour market and inflation.
Friday's jobs reports implies limited price pressure from the labour market, but rent, which accounts for about a third of the index, posted its biggest gain in five years in November and is seen increasing further in 2014.
IRELAND, PORTUGAL, NETHERLANDS RATINGS
In Europe, Ireland was the star turn of the past week.
The recovered aid recipient raised almost half of its 2014 borrowing target on Tuesday, in its first debt sale since exiting its EU/IMF bailout and hauled down bond yields in its euro zone periphery peers.
Portugal, aiming to exit its bailout this year, scored a success with its first debt sale of 2014 two days later. nL6N0KJ16Q
Italy and Spain will hope the positive contagion on the periphery extends into the coming week, as they sell bonds on Monday and Thursday respectively.
The week will conclude with ratings agencies' verdicts on Ireland, the Netherlands and Portugal.
Moody's is the only one of the big three agencies to rate Ireland below investment grade. An upgrade from junk is seen as a condition for many Asian investors to return to Irish debt.
Standard & Poor's will publish its review of Portugal on the same day, although market expectations of an improvement to its BB rating or credit watch negative status are more muted.
Citi is forecasting that S&P will cut by a notch to BB-.
The Netherlands, still reeling from a burst property bubble and struggling to rein in its deficit, risks a further loss of its top-flight status if Fitch follows S&P's lead in November in cutting the sovereign from AAA.
Earlier in the week, on Tuesday, French President Francois Hollande will hold a news conference to flesh out a New Year announcement of a "responsibility pact", offering potentially lower labour taxes for companies that hire more.
PRELUDE TO CHINA GDP
Asian data appears sparse.
In Japan, November machinery orders on Thursday will offer the latest gauge of Abenomics, the aggressive economic stimulus of Prime Minister Shinzo Abe's year-old government. They are expected to grow at a faster pace, in a sign companies are investing to meet strong domestic demand.
In China, home price inflation, due on Saturday, probably quickened to its highest level of the year in December, marking a 12th consecutive month of year-on-year increases.
But the data are unlikely to trigger more government curbs as monthly gains are expected to have slowed for a fourth straight month. The strong uptrend may ease in the coming months as government efforts to cool the market bear some fruit.
According to a Reuters poll in November, Chinese house price growth will ease to 5 percent this year from 10 percent in 2013.
Next week, though, is more a prelude to economic growth data for the fourth quarter and the whole of 2013, due on Jan. 20.
Overall, Chinese growth appears to have slowed at the end of last year, according to December services and manufacturing purchasing manager surveys. But the outlook for exports and industries, including autos, in 2014 is promising as global demand picks up.