Weekly Market Snapshot 7-11/8 | Chinese data, USA CPI and wage growth, New Zealand’s Interest rate decision & the UK’s production and output data are the highlights from the key calendar events

Aug 4 • Extras • 404 Views • No Comments

The week commencing Sunday August 6th is a relatively quiet week for high impact news events, however, traders need to maintain a high level of concentration during an extremely busy week for news releases. China releases a raft of data throughout the week, the stand out release is Wednesday’s CPI print and on Thursday the level of new yuan loans is then published. Wednesday also witnesses the RBNZ interest rate decision, currently at 1.25% it’s one of the highest in the developed world and the kiwi is an actively traded currency, therefore the potential for sudden spikes in NZD pairs are high. On Thursday the governor of the RBA gives evidence in Melbourne regarding Australia’s economy, a speech that has the potential to move the Aussie. On Thursday the UK’s ONS provides data on production and output, with focus on Brexit, sterling currency pairs could come under pressure, if these figures miss forecasts. On Friday the latest USA CPI data is printed, as is a raft of other USA hard data on inflation, relating to the consumer, such as ‘real’ wage growth.

Monday begins the week with an extremely busy schedule for economic calendar news, although the majority of news events on the day, are low to medium impact releases. New Zealand publishes its two year inflation expectation, forecast to remain at 2.2%, Germany’s industrial production is predicted to remain at circa 5% growth YoY. The Swiss CPI is published, expected in at 0.2% YoY. The Eurozone Sentix investor confidence reading is published. As attention turns to the USA the labour market conditions index is released, as is consumer credit, which is forecast to fall to €17.0b for June, from $18.4 in May. In late evening focus turns to Japanese data; the trade balance for June is forecast to be similar to May’s reading, at -115b yen.
Tuesday starts the day with a raft of Chinese data; exports, imports, foreign investment and the trade balance. Foreign direct investment is forecast to remain at a similar level to that recorded in June, at 2.3% growth. The trade balance at $43b for June, is predicted to come in at a similar figure for July, whilst the export growth at 17.3% in June, is expected to be maintained in July’s figures. Japan’s Eco Watchers’ survey is forecast to remain at circa 50, whilst there’s no expectation for a significant change in Japan’s bankruptcies, which fell by -7.47% in June. Australia’s NAB business confidence and conditions survey is published, before attention switches to Europe. The Swiss unemployment rate is forecast to remain at 3%, and Germany publishes data on: imports, exports, trade balance and their current account, all are expected to display continual improvement. As focus turns to North America, Canada’s housing starts data is revealed, as is the USA monthly JOLTS data (job openings).

Wednesday’s first high impact news event begins with China’s CPI, forecast to come in at 1.4% for July, keeping the YoY figure at circa 5.5%. From Australia: home loans, value of loans and investment leading data, is revealed. Japanese tool orders are also published, the previous growth figure of 31.1% YoY is predicted to be met, or surpassed. As the New York open approaches, USA mortgage applications for the first week in August are revealed, building permits for Canada, USA wholesale trade and inventory data, and the weekly crude oil inventories for the previous week. Late evening concentration moves onto New Zealand’s central bank, the forecast is for the RBNZ to maintain the current rate of 1.75%, governor Wheeler will then host a news conference explaining the rationale behind their decision. Machine orders for Japan fell in May by -3.6%, analysts will be looking for improvement in June’s figures.

Thursday’s high impact news (as on Wednesday), begins with Chinese data; new loans came in at 1540 yuan in June, a higher figure for July is expected. Australia’s consumer inflation expectation is forecast to remain steady at circa 4.4% YoY. European news begins with a raft of U.K. economic data; industrial, manufacturing and construction output/production data is published, the anticipation is for the June figures to improve marginally, from the negative readings published for May. The trade balance data is also revealed, the deficit deteriorated to -£11.5b in May, an improvement is sought. As focus moves to North America, Canada’s new housing price index for June is published, the USA weekly claims and continuing claims numbers, and an array of PPI data for the USA. The USA monthly budget statement at -$90.2b for June is expected to show improvement in July. The day ends with the governor of the RBA Mr. Lowe appearing before a committee in Melbourne.

Friday begins with Germany’s CPI YoY data, the forecast is for no change on the June reading of 1.7%. The USA CPI figure is published, forecast to remain at 1.7% YoY. Earnings (weekly

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