Week Ahead – Aug 28th

It will be a very busy week in the United States with investors following closely the labor report, alongside the PCE price index, personal income and spending data, JOLTS job openings, ISM Manufacturing PMI, and the second estimate of Q2 GDP growth. Elsewhere, the focus will be on inflation rate figures for the Euro Area, Germany, France, Italy, Spain, and Switzerland. Additionally, flash manufacturing PMI readings will be released for China, South Korea, India, Russia, Spain, Italy, and Canada. Finally, Turkey, India, Brazil, and Canada are set to report their Q2 GDP growth figures.

The US economy is projected to have added around 170,000 jobs in August, marking the lowest addition since a loss of 268,000 jobs in December 2020. Meanwhile, the unemployment rate is expected to remain steady at 3.5%. The Core PCE prices, which are the Federal Reserve’s preferred measure of inflation, are anticipated to increase by 0.2% month over month in July, mirroring the rise seen in June. Concurrently, personal income is predicted to grow by 0.3%, and personal spending is expected to see a 0.6% increase. Several other significant releases to monitor include JOLTs job openings, the ISM Manufacturing PMI, the second estimate of Q2 GDP, Case-Shiller home price data, pending home sales figures, and the CB Consumer Confidence Index. Additionally, attention will be on the advance estimates of the goods trade balance and wholesale inventories. Regional industry indicators such as the Dallas Fed Manufacturing Index and the Chicago PMI will also contribute to the broader economic picture. Elsewhere in Americas, Q2 GDP growth rates, manufacturing PMI’s and jobless rates will be reported for Canada and Brazil.

In Europe, investors will be awaiting the ECB monetary policy meeting minutes, in an attempt to gauge whether the central bank will raise or maintain rates in September, particularly given Europe’s sluggish economic performance. Also, the focus will be on the release of flash inflation figures from the Eurozone, Germany, France, Italy, and Spain. The annual inflation rate in the Euro Area is expected to slow for the fourth consecutive month to 5.1% in August, the lowest since early 2022 but still well above the ECB’s 2% target. Additionally, the key jobs report will be published for the Euro Area, Germany, and Italy, and S&P Global will update manufacturing PMIs for the region. In Germany, retail sales in July are forecasted to rebound following an unexpected decline, while the Gfk consumer confidence indicator is anticipated to remain relatively stable. Other data to follow includes the Euro Area’s business survey; France and Italy’s final GDP figures and business and consumer surveys; Switzerland’s CPI data, KOF Leading indicators, and retail sales; and Turkey’s Q2 GDP. Meanwhile, it will be a quiet week in the United Kingdom, with only the final manufacturing PMI survey, Bank of England’s monetary indicators, and Nationwide house prices set to be released.

In Asia, Chinese PMI figures for August will likely show the extend of recent economic slowdown, possibly offering clues on whether the Politburo may engage in a greater extent of economic support to prevent a further slide in property prices. PMI data will also be updated for India and South Korea, with the former also unveiling its June-quarter GDP, while the latter will release its trade balance for August. In Japan, a batch of economic data includes consumer confidence for August, in addition to industrial production, retail sales, and housing starts for July.

In Australia, a series of releases will be headlined by July’s CPI, the last bit of price data before September’s RBA decision. Other Aussie releases include retail sales, building permits, and a cluster of housing credit data. Across the Tasman Sea, New Zealand is set to unveil August business confidence.