Ostwald, Marc
08:21 (31 minutes ago)
to Marc
- Quiet start to the week with little in the way of economic data, focus on
central bank speakers: Wilkins, Weidmann, Bostic & Lowe; JODI Oil Exports
and pre-amble to US/China trade talks also in view
- Week ahead: largely second division run of data and surveys will have to
spring surprises to impact; central bank speakers, minutes and Jackson
Hole symposium the focal points outside of perma-gaze on politics and
trade tensions
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** EVENTS PREVIEW **
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The week gets off to a very modest start in terms of scheduled data and events, perhaps appropriate for the height of the summer holiday season, though politics as ever retains its status as primary supplier of 'tape bombs', be that USA/China trade (a decision on the imposition of a further $200 Bln is said to be due today), Turkey, Italy or Brexit. Today also has a meeting of Putin's United Russia party to discuss changes to the immensely unpopular pension reform changes. Statistically there is no major data outside of the already published German PPI, though Poland has its run of booming industry data and PPI, while central bank speakers are relatively plentiful via way of ECB's Weidmann, BoC's Wilkins, Atlanta Fed's Bostic and RBA's Lowe. Today also sees JODI Oil Exports data, albeit for June, amid questions about how much Saudi Arabia will actually hike output in response both to Trump's demands and the OPEC+ agreement to restore output to agreed levels.
- The week ahead will also be dominated by politics and central bank events, rather than data. The latter sees US Home Sales and Prices along with Durable Goods, while Japan looks to Retail Sales and National CPI; elsewhere the focus will be on G7 flash PMIs and numerous national confidence and business surveys, UK PSNB, Australia Q2 Construction Output, Canadian Retail Sales and South African CPI. The relatively low level meeting between China and the US on trade will attract much attention, while the week also sees minutes of the most recent Fed, ECB and RBA meetings ahead of the annual Jackson Hole gathering of central bankers, which has lost some of its cache as a signalling event for future central bank policy, in no small part due to the pervading sense of uncertainty about the outlook for the global economy. The corporate earnings schedule is relatively modest, while Germany tops the govt bond auction run with 2 & 10-yr auctions, and the UK offers 10-yr Index-Linked Gilts.
- It can probably be safely observed that the week's economic data, which is largely second division, will have to spring some quite big surprises to really have more than a passing impact, and that all eyes will be on central banks. The ECB and RBA minutes are unlikely to offer anything new in the way of insights, given the ECB meeting was a case of 'our views have not changed since the June meeting', and the RBA already detailed its views in its quarterly Statement on Monetary Policy (SOMP). The July FOMC minutes will be closely watched given the debate on whether the ultimate policy trajectory is the 'neutral rate', or whether it needs to be or rather may need to be restrictive, which should be accorded a higher probability given the formerly very dovish Evans signal shift to a quasi-hawkish stance. As for Jackson Hole, Powell is very clearly not one to grandstand on economic theory or monetary policy, and it is thus unlikely that this year's symposium will offer major signals on the policy outlook, in no small part reflecting both the array of uncertainties on the global economic outlook, but also given G7 central bankers' increasingly obvious desire to carve out greater room for manoeuvre and policy flexibility, as well as weening markets off the hand holding 'guidance' of the past decade.
from Marc Ostwald
