US
It remains all about the Fed as it continues down an aggressive tightening path. Wall Street will now fixated on how quick this economy is going to weaken. A weakening consumer will help drive down inflation but so far this economy has shown a lot of resilience in the service sector.
Investors will have a handful of key economic releases to follow this week. On Monday, the ISM manufacturing report is expected to soften but still remain in expansion territory while prices paid, new orders, and employment could show modest weakness. Factory orders are also expected to turn positive in August.
The key economic release for the week is the September nonfarm payroll report, which should show hiring continued with 250,000 jobs created. Unemployment is expected to remain steady at 3.7%, while wages continue to steadily increase at 0.3% over the prior month.
It will be another week filled with Fed speak; this time with 13 appearances. On Monday, we will hear from Bostic and Williams. Tuesday’s comments come from Logan, Williams, Mester, Jefferson, and Daly. On Wednesday, Bostic speaks on inflation. Thursday’s appearance will include Evans, Cook, Waller, and Mester. On Friday Williams speaks in New York.
EU
The minutes from the last ECB monetary policy meeting will no doubt be of interest but in reality, it all feels quite outdated. A 75 basis point rate hike is priced in for the next meeting, maybe even 100bps, and I’m not sure what in the minutes could change that.
There’s a lot of economic data being released and they may not make for great reading, particularly on the PMI front as companies head into a nervy winter period.
UK
It’s barely worth looking at the economic calendar next week as the direction of the pound is unlikely to be driven by the final PMI readings or Halifax PMI.
The spotlight will be on the government and Bank of England and the prospect of u-turns and more interventions. Commentary from Prime Minister Liz Truss, Chancellor Kwasi Kwarteng and BoE policymakers will obviously be of interest but ultimately it’s what they do more so than what they say that people are interested in. In the absence of action, will pressure mount on Truss and Kwarteng from within?
Russia
While the focus next week obviously centres around events in Ukraine and the response of the West to the “referendum results”, there is some economic data that will be of interest including inflation data and PMIs.
South Africa
A quiet week with the whole economy PMI on Wednesday the only notable release.
Turkey
The CPI data on Monday will tell us everything and the CBRT nothing about the shambolic monetary policy experiment taking place in Turkey. Inflation is expected to hit almost 85% in September but with President Erdogan calling for more rate cuts, we all know what’s coming next.
Switzerland
The SNB wants everyone to know that further rate hikes are coming, perhaps even before the next scheduled meeting, and the inflation data on Monday may tell us how seriously we should take those threats. PMI and unemployment data wrap up the week on the data front.
China
Golden week holidays are here and Mainland Chinese markets are closed through October 7th, while Hong Kong is only closed on Tuesday. After some verbal warnings about potentially selling dollars, traders will pay close attention to how the yuan trades. The PBOC could provide more signals about selling dollars.
India
The focus may be on the RBI and if they have pressure to tap their forex reserves. Economic data releases include both the manufacturing and services PMI releases.
Australia & New Zealand
Both the RBA and RBNZ are expected to continue with their tightening cycles.
The RBA is expected to deliver a fifth consecutive half-point hike despite signalling it could opt for a slower pace. With the rest of the world continuing to tighten aggressively, the central bank may want to avoid a downshift from its current pace.
The RBNZ is also expected to deliver a fifth straight half-point rate hike as inflation risks remain elevated. The peak in the tightening cycle is nearing thanks to lower energy prices and an improvement in supply chains.
Japan
It will be a busy week with lots of Japanese economic data. Key releases include the Tankan manufacturing report, PMI surveys, household spending data, and the leading index. Traders will pay close attention if the Japanese yen returns back to levels seen before the intervention. Currency intervention remains the most powerful that Japan has left to avoid massive selling pressure on the yen given the BoJ’s reluctance to tweak its yield curve control.
Singapore
Second-tier releases include the purchasing managers’ index, retail sales, and foreign reserve data. The Singapore dollar has been weakening but is still far from the lows seen earlier in the pandemic.
Economic Events
Mainland Chinese markets are closed through Oct. 7 for the Golden Week holidays
ECB’s de Cos joins a panel on the future of globalization at La Toja Forum 2022 in Galicia, Spain
Economic Events
Brazilians vote in the Presidential election
UK Conservative Party autumn conference starts in Birmingham, with speeches from Prime Minister Liz Truss and Chancellor Kwasi Kwarteng
Economic Data/Events
US construction spending, ISM manufacturing, light vehicle sales
Eurozone manufacturing PMI
France manufacturing PMI
Germany manufacturing PMI
India manufacturing PMI
Japan Tankan, vehicle sales
Singapore home prices, PMI
UK S&P Global / CIPS UK manufacturing PMI
Fed’s Bostic gives opening remarks at a conference on technology-enabled disruption
Fed’s Williams speaks at the US Hispanic Chamber of Commerce National Conference in Phoenix
Euro area and EU finance ministers meet in Luxembourg
Economic Data/Events
US factory orders, durable goods
RBA decision: Expected to raise Cash Rate Target by 50bp to 2.85%
Australia building approvals
Colombia monetary policy minutes
Eurozone PPI
Japan Tokyo CPI
Mexico international reserves
Spain unemployment
Fed’s Williams gives opening and closing remarks at an event on culture in the workplace hosted by the regional Fed bank
Fed’s Logan speaks at an event on technology-enabled disruption hosted by the Atlanta Fed
Fed’s Mester speaks at a payments conference hosted by the Chicago Fed
Fed’s Daly takes part in a moderated Q&A at the Council on Foreign Relations in New York
ECB’s Centeno speaks at a conference in Luxembourg
German Foreign Minister Baerbock speaks at the Warsaw Security Forum
Austrian financial regulator’s annual conference. Speakers include ESMA’s Verena Ross, ECB Supervisory Board chairman Enria, and Austrian Finance Minister Brunner
Economic Data/Events
US trade
Eurozone Services PMI
France industrial production
New Zealand rate decision: Expected to raise rates by 50bp to 3.50%
Poland rate decision: Expected to raise rates by 25bp to 7.00%
Russia GDP
Singapore retail sales, car permit prices
Thailand CPI
OPEC+ meeting
Fed’s Bostic discusses inflation during a virtual event hosted by Northwestern University
EIA crude oil inventory report
Economic Data/Events
US initial jobless claims
Australia trade balance
Eurozone retail sales
Germany factory orders
Hungary one-week deposit rate
Spain industrial production
Fed’s Evans discusses the economy and monetary policy at an event hosted by the Illinois Chamber of Commerce in Chicago
Fed Governor Cook speaks at the Peterson Institute for International Economics in Washington. Fed’s Mester discusses the economic outlook during an event hosted by the Council for Economic Education.ECB publishes an account of its September policy meeting
Economic Data/Events
US September change in nonfarm payrolls: 250K v 315K prior, wholesale inventories
Australia’s central bank semi-annual financial stability review
Canada unemployment
China forex reserves
France trade
Germany industrial production
Japan household spending
Mexico CPI
Russia CPI
BOE Deputy Governor Dave Ramsden speaks at a securities industry conference on the development of fintech services
Fed’s Williams takes part in a fireside chat and moderated Q&A in Buffalo, New York
European leaders from within and outside the EU have an informal summit and meeting in Prague, the so-called European Political Community gathering
Sovereign Rating Updates
Austria (Fitch)
Greece (Fitch)
Israel (Moody’s)
Ukraine (Moody’s)
Cyprus (DBRS)
Netherlands (DBRS)
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