Week Ahead

The US, China and India will be publishing inflation updates for July in the coming week, while second-quarter GDP releases from the UK, Malaysia, and the Philippines and factory production numbers from the Eurozone and India will also be keenly watched. Other important data to follow include US consumer confidence, Germany trade balance, Japan current account and Australia business morale. Elsewhere, central banks in Mexico, Turkey and the Philippines will be deciding on interest rates.

It is a relatively busy week ahead in the US on the economic data front. The consumer price report for July will probably show the consumer price inflation rate stood at 5.3 percent, little-changed from the previous month’s 13-year high of 5.4 percent and well above the Federal Reserve’s target of about 2 percent. At the same time, the preliminary estimate of Michigan consumer sentiment for August will likely show a slight improvement in morale after an unexpected decline in July sent the indicator to a five-month low. Other publications to watch for are producer and foreign trade prices, JOLTs job openings, second-quarter labor productivity and the government’s monthly budget statement.

Elsewhere in America, important data to follow include Canada preliminary estimate of producer prices; Mexico inflation data and industrial output; Brazil inflation rate, retail sales and business morale; Chile trade data; and Argentina consumer prices. Central banks in Mexico and Peru will be deciding on interest rates.

Across the Atlantic, the UK will be publishing its preliminary estimate of second-quarter GDP growth, alongside business investment, trade balance, manufacturing and construction output. The British economy likely grew 4.8 percent in April-June, recovering from a 1.6 percent contraction in the previous period, as the rapid pace of COVID-19 vaccinations allowed the country to continue its re-opening efforts, and boosted consumption.

Elsewhere in Europe, the Eurozone industrial activity will be eagerly awaited, as well as Germany ZEW Economic Sentiment Index. Factory activity in the Euro Area probably stalled in July as supply bottlenecks continued to weigh on production; while German investor morale is seen falling for the fourth consecutive month to the lowest level this year. Other key data to follow include: Germany foreign trade; France and Switzerland unemployment data; Ireland, Norway and Sweden consumer prices; Poland and Russia second-quarter GDP figures; and Turkey industrial production and unemployment rate. Elsewhere, the Central Bank of Turkey is seen leaving its benchmark interest rate steady when it meets on Thursday.

In the Asia-Pacific region, China will be publishing inflation data for July, with markets pointing to a softer increase in consumer prices and a steady producer price inflation, which is likely to remain close to May’s near 13-year high. Meanwhile, Japan is releasing data on current account, producer prices and Eco Watchers Survey Outlook. In Australia, investors will turn their attention to NAB business confidence, Westpac consumer morale and the final reading of building permits.

Other highlights include: India consumer prices and industrial production; the Philippines and Malaysia second-quarter GDP; South Korea jobless rate; and New Zealand food inflation. The Philippine central bank is seen keeping interest rates at record-low levels when it meets on Thursday.

Categories: Markten