London, Sunday 13 August 2023
Investors will eagerly await the release of the FOMC minutes the following week in order to gain more information about the Fed's plans for the rest of the year. Retail sales and industrial manufacturing will also receive attention in the US. A number of important economic reports are expected to be released in other countries next week, including those from China (industrial production and retail sales), the Eurozone (GDP and inflation), Japan (GDP growth and inflation), Germany (economic sentiment), India (wholesale and consumer prices), the UK (inflation, unemployment, and retail sales), Canada (CPI), Australia (unemployment data), Norway, the Philippines, and New Zealand (interest rate decisions).
Although Chair Powell stated last month that decisions will be made on a meeting-by-meeting basis, investors in the US will keenly watch the FOMC minutes for new insights into the Fed's plans for the rest of the year. The odds of the Fed keeping interest rates in September are at 89%, while the chances of a quarter-point increase in November are currently about 32%. Home Depot, Cisco, Walmart, Deere & Company, Target, and Applied Materials are just a few of the firms scheduled to release their second-quarter results as the earnings season comes to a conclusion.
In terms of data, forecasts point to a faster 0.4% rise in retail sales and a rise in industrial production after a decline in June. Consumer inflation expectations, building permits, housing starts, the NY Empire State Manufacturing Index, the Philadelphia Fed Manufacturing Index, and the NAHB housing index are additional significant releases.
Canada's inflation rate is anticipated to increase from 2.8% to 3% elsewhere in America. This comes after inflation started to fall down in July of the previous year, after reaching 8.1%, a high not seen since 1983, in June 2022. Additionally, the GDP growth rates for Chile and Colombia as well as Argentina's inflation rate are required.
The economic calendar in the United Kingdom is jam-packed with important announcements, such as retail sales, inflation data, and unemployment rates. The UK's inflation rate is expected to have dropped to 6.8% in July, its lowest level since February 2022, and retail sales, which had increased for three consecutive months, are likely to have decreased. The unemployment rate is forecast to remain constant at 4% in the second quarter.
A second estimate of Q2 GDP and the final measurement of July's inflation rate will be released by the Euro Area. German investor morale is anticipated to stay stable at the same time. Other significant economic information includes the industrial production and trade balance for the Eurozone, the wholesale prices for Germany, the foreign trade of Spain, and the GDP numbers for Poland and the Netherlands. In terms of monetary policy, the Norges Bank will probably increase its key policy rate as long as inflation continues significantly higher than the objective.
In Asia, July's major economic releases for China include data on industrial output, retail sales, and unemployment that are expected to shed more light on the nation's sluggish economic recovery in the wake of a number of already-released dismal findings for the time period. In light of recent risks to the financial viability of real estate developers, investors will also pay special attention to fixed investment and housing price statistics. The second quarter's GDP growth in Japan, which is predicted to continue growing strongly, as well as the inflation rate and trade balance for July, will be the main topics of discussion. As a result of rising energy and food prices, India's inflation rate is predicted to rise above the upper limit established by the RBI and reach 6%.
In other news, the GDP growth rates for Thailand and Malaysia will be revealed, while the Philippines' central bank will meet to discuss monetary policy.
Investors in Australia are awaiting the minutes from the RBA's most recent decision to learn more about the unexpected rate hold by the central bank. Australian unemployment statistics for July will also be shared. The Reserve Bank of New Zealand is anticipated to keep borrowing costs steady in the meantime.
(Research and edit by The Decision Maker - Finance editors)