fbpx

Jackson Hole symposium, PMI data: what will impact market?


Jackson Hole symposium, PMI data: what will impact market?

While the market is reacting to the world’s major central bank decision, economic data such as inflation, retail sales, growth numbers, and housing data.  This week, all eyes will be on the Fed’s annual economic symposium. It will be an important event for the week, as FOMC officials gather at their summer retreat in Jackson Hole, Wyoming for a symposium to exchange views on monetary policy and economic trends. Although this is primarily an academic event, Fed presidents have used it in the past to foreshadow significant strategy adjustments. Every statement for future rate decisions will give the direction to the US yields and dollar.

Important data and events scheduled during the week

Monday – China loan prime rate

The weekly economic calendar will start with China’s central bank decision. PBoC is set to take more easing steps. It may cut China’s loan prime rate by 3.40% from 3.55%, over the concern of economic slowdown.

A bunch of dismal figures like the Deflationary situation, Subdued Trade balance, Industrial growth, and Retail sales indicate the world’s second-largest economy is struggling to shake off the June quarter is creating hopes for more stimulus packets to support the economy.

Wednesday – Eurozone Flash PMIs:

Eurozone set to release preliminary PMI business surveys for August. Forecasts suggest manufacturing will stable slightly. The numbers are expected to come to 45.2 from 45.1 in previous months. While German manufacturing and Service PMI will continue to deepen. The forecast is 38.6 from 38.80, and 51.5 from 52.30 respectively.

U.K. manufacturing PMI is expected to come to 45.10 from 45.3 in July, while services are forecast to slow from 50.90 to 51.5 in July.

On the same day, S&P Global released preliminary US Manufacturing and Services PMI reports for August. Services PMI is expected to come to 52.4 from 52.30, if it drops below 50 and shows a contraction in the service sector’s business activity, the dollar faces pressure against its major counterparts.

Thursday – Weekly unemployment claims

It will be the first day of the Fed’s annual economic conference, spanning into the weekend. The event attracts a large number of central bankers, finance ministers, academics, and financial market specialists from around the world. The day will be filled with central bankers’ and other key individuals’ remarks and speeches, which will keep volatility high.

US weekly Jobless Claims will also be released which may have a neutral impact on the dollar.

Friday – German IFO, Fed, ECB chair speech

German IFO business climate survey set to release, the forecast is seen at 86.80 continued to deepen. Last month, data fell to its lowest level since October last year in July at 87.3. The data is suggesting the economy could remain fragile.

On the same day, Fed Chair Powell and ECB President Lagarde Speak at Jackson Hole Symposium will have to closely watch.  Last year Powell’s hawkish comments sparked an uptick in yields, and this year it will be interesting to hear how they assess the latest more promising inflation data.