Newsquawk Week Ahead: US ISM, PCE and NFP, EZ CPI, ECB Minutes and Chinese PMIs

Saturday, 26/08/2023 | 21:32 GMT+5.5

The upcoming edition of News quawk Week Ahead presents advance insights into significant events scheduled for the next week. These include pivotal occurrences such as the US Non-Farm Payrolls (NFP), US Institute for Supply Management (ISM), and US Personal Consumption Expenditures (PCE) reports. Additionally, the release will cover essential updates like the European Central Bank (ECB) Minutes, Eurozone Consumer Price Index (CPI), and Chinese Purchasing Managers’ Indexes (PMIs).

Week Ahead August 28th – September 1st

  • Monday: The week starts with the release of Australian Retail Sales data for July.
  • Tuesday: On this day, there will be an announcement from the National Bank of Hungary (NBH), along with the unveiling of German GfK Consumer Sentiment figures for September. The economic calendar also includes the release of US CaseShiller data for June and the JOLTS report for July.
  • Wednesday: Mid-week, attention turns to crucial economic data including Australian Consumer Price Index (CPI) numbers for July, Spanish Flash Consumer Price Index for August, and the Eurozone Sentiment Survey results for August. In addition, the second estimate of US Gross Domestic Product (GDP) for the second quarter will be disclosed, alongside the US ADP National Employment figures for August.
  • Thursday: Thursday brings the release of the European Central Bank (ECB) Minutes, providing insights into recent policy discussions. Other notable releases include Japanese Retail Sales data for July, the Chinese Official Purchasing Managers’ Index (PMI) for August, and both German Retail Sales and Unemployment figures for August. The day also features the release of the Eurozone Flash Consumer Price Index for August, US Challenger Layoffs data for August, and US Personal Consumption Expenditures (PCE) data for July.
  • Friday: The week concludes with significant releases, including the Chinese Caixin Manufacturing PMI for August and Swiss Consumer Price Index figures for August. Moreover, the final Manufacturing PMI results for August will be unveiled for the Eurozone, UK, and US. The influential ISM Manufacturing PMI for August will also be made public. Additionally, the US Labor Market Report for August and Canadian GDP figures for the second quarter will wrap up the week’s economic announcements.

Note: Previews are listed in day order

Australian Retail Sales (Mon):In July, it is anticipated that retail sales will experience a 0.3% month-on-month increase, rebounding from a 0.8% decline witnessed in the previous month. Analysts from Westpac have projected a figure slightly surpassing market expectations. They attribute this outlook to a marginal strengthening seen in their Westpac Card Tracker data for July. Highlighting the influence of population growth, which stands at 0.2% per month, Westpac indicates that even if sales remain steady in real (inflation-adjusted) terms per capita, the cumulative nominal sales could exhibit a 0.4% monthly increase. Reflecting this, their assessment for July suggests a broad month-on-month increase of 0.4%, as per the insights provided by the research desk.

Australian CPI (Wednesday): The monthly Consumer Price Index (CPI) data for Australia is projected to reveal a decrease to 5.2% in July from the previous month’s 5.4%. These newly introduced monthly inflation indicators hold crucial significance for the Reserve Bank of Australia (RBA) as they guide its data-dependent policy decisions, considering the historical quarterly releases. Westpac’s analysts note a specific concern about electricity prices this quarter due to the impact of state energy rebates and variations in bill timing. Despite the introduction of a monthly electricity price series, there remains uncertainty about the monthly seasonality of these changes.

Chinese PMIs (Thursday): China’s National Bureau of Statistics Manufacturing PMI is predicted to marginally improve but remain below the contraction threshold, with an August forecast of 49.5 (previously 49.3 in July). China’s recent economic challenges are underscored by disappointing data in trade, inflation, and activity. Authorities have taken steps to boost the economy and stabilize stock markets, yet analysts believe substantial government support is needed to counter weak global demand.

EZ Flash CPI (Thursday): Expectations indicate a decline in the year-on-year headline flash Consumer Price Index for the Eurozone to 5.1% in August from 5.3% in the prior month. The super-core metric is also projected to decrease to 5.3% from 5.5%. The previous report highlighted a pullback in headline inflation due to energy prices, while the super-core reading remained steady. Analysts foresee the upcoming release reflecting declines in food and core inflation, offsetting any potential energy inflation increase driven by rising crude oil prices. The outcome will likely impact policy considerations, especially after soft PMI metrics prompted a dovish reassessment for the European Central Bank’s September meeting.

ECB Minutes (Thursday): Following the anticipated 25 basis points hike in the deposit rate to 3.75%, focus was on the minor adjustment in the ECB’s language regarding future decisions. Insights from the meeting minutes might offer clarity on policymakers’ views about potential further tightening and the delicate balance between rate hikes and Quantitative Tightening (QT).

US PCE (Thursday): Headline Personal Consumption Expenditures (PCE) prices are expected to show a 0.2% month-on-month rise in July, with the core rate also expected to increase by the same magnitude, reaching 4.3% year-on-year. Analysts predict that the PCE deflator will affirm the disinflation noted in July’s Consumer Price Index report, while gradual disinflation in housing might impact PCE rates in the coming months.

Swiss CPI (Friday): July’s release aligned with market expectations, and the focus now shifts to August. If the reading surpasses the Swiss National Bank’s forecast of 1.7%, it could raise concerns for policymakers, particularly if it signals a sustained return of inflation within their target range.

ISM Manufacturing PMI (Friday): The consensus for August’s ISM Manufacturing PMI is 47.0, suggesting a slight change from the previous month’s 46.9. The S&P Global PMI data indicated a decline in operating conditions, signaling potential challenges for the manufacturing sector.

US Jobs Report (Friday): Expectations for August’s US nonfarm payrolls are set at 160,000, lower than the previous month’s 187,000. The unemployment rate is anticipated to remain at 3.5%, while average hourly earnings are predicted to rise by 0.3% month-on-month. The labor market’s performance and the Federal Reserve’s projected rate adjustments will continue to be closely monitored.

Original Content: News

Leave a Reply

Your email address will not be published. Required fields are marked *