Will Global Economic Numbers give direction this week?

This week main events will be Fed meeting minutes of the July meeting. Further, Retail sales data and retail earnings will indicate consumer spending while data out of China is expected to underline concerns over the faltering recovery in the world’s number two economy.

Important data and events scheduled during the week

Tuesday – U.S. Retail sales, China Industrial production

The U.S. is to release July retail sales data set to release.  The data is forecasting to have a pickup in demand at the start of the third quarter after a smaller-than-expected increase in June.

On the same day, the Empire State manufacturing index forecasting to fall into negative territory.

The crucial data will be released by Beijing.  Retail sales, industrial production and fixed asset investment are expected to point to only minor gains.

The UK will release the June employment report. Wage growth is expected to remain around 7% (year-over-year), and the Unemployment Rate is projected to be at 4%. A positive report in these areas would be supportive of the Pound.

Reserve Bank of Australia (RBA) meeting minutes will have a minor impact on the dollar.

Canadian Consumer Price Index (CPI) YoY for July is due to release. The data is expected to rise slightly by 0.3% from 0.1% on a month basis.

Wednesday – U.S FOMC meeting minutes

  • The market will react strongly to FOMC minutes at 11.30pm.  If it shows Fed officials leaning towards a pause in September/November could mount pressure on the dollar.
  • The UK will release the July inflation report which will impact strongly on the pound. The data includes the Consumer Price Index (CPI) and the Producer Price Index (PPI). The CPI is expected to show a significant decline in the annual rate from 7.9% to 7%, with the Core CPI rate falling marginally from 6.9% to 6.8%.
  •  If the numbers come below expectations, it may have a neutral impact on the pound, as it could improve the economic outlook.

Thursday– US Inflation numbers

  • The U.S. is also to release the weekly report on initial jobless claims which is expected to be slightly lower at 240k after a larger than expected increase last week by 248k.  

Friday- UK Retail sales

  • Another important report in the UK will be the July Retail Sales, to be released on Friday.