Preview Of Key Events In The Coming Week

Following two weeks of monetary policy and economic data deluge, the event calendar is decidedly quieter this week as the mid-August sun rises and as Q2 earnings season approaches its end.

The coming week brings multiple macro data releases for July, including inflation, trade data, retail sales, IP, credit and money supply. A relatively light US data calendar next week with retail sales the main release on Friday but also import and producer prices and Michigan sentiment coming up. Retail sales will be closely watched to assess consumer spending growth for 3Q.

Over the weekend we got the latest Chinese reserve data which showed reserves fell US$4bn to US$3,201bn in July, however after adjusting for estimated currency valuation effects, Goldman calculated that the reserves fall would be about US$15bn (vs. an estimated increase of US$23bn in June); overnight we also got the latest Chinese trade data which as reported previously disappointed for both imports and exports.

It’s a quiet start to the week today with data due in Europe limited to Germany industrial production, France business sentiment data and Euro area investor confidence. In the US there’s nothing of note aside from the latest labor market conditions update.

We kick off in China on Tuesday where the July inflation report will be worth watching. In Europe we’ll get industrial and manufacturing production numbers in the UK covering June, along with Germany trade data. In the US on Tuesday we’ve got the NFIB small business optimism reading for June, Q2 nonfarm productivity and unit labour costs, wholesale inventories and trade sales and finally the IBD/TIPP economic optimism reading.

In Asia on Wednesday we’re due to get the latest machine orders and PPI data in Japan. Over in Europe there’s more industrial production data due out, this time from France, while in the US the June JOLTS job opening report and July Monthly Budget Statement is due.

It’s another fairly quiet day on Thursday with France and Italy CPI highlighting the morning session, while initial jobless claims and the import price index reading are the only releases on the other side of the pond.

Things finally pick up on Friday with a busy end to the week. Firstly in China we’ll get the industrial production, retail sales and fixed asset investment data for July. Turning to Europe we’ll firstly get Germany CPI for July and Q2 GDP, followed by France wage data and then Euro area industrial production for June and also Q2 GDP. It’s a bumper session in the US too with July retail sales data, last month’s PPI report, June business inventories and finally the first estimate of the University of Michigan consumer sentiment reading.

On the monetary front, in G10 another potential rate cut coming up, this time from the RBNZ, which BofA expects will ease rates by 25bp to 2.0%.

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BofA breaks down the key weekly events by geography:

• After a stellar NFP, a relatively light US data calendar next week with retail sales the main release on Friday but also import and producer prices and Michigan sentiment coming up. Retail sales will be closely watched to assess consumer spending growth for 3Q.
• In the Eurozone we get initial prints of German and Italian Q2 GDP, as well as the second reading for the Euro area as a whole.
• In the UK, following the BoE this week the calendar brings IP, trade balance and construction output data but this is data for June so largely pre-Brexit. We do get an update of the BOE Agent’s summary of business conditions on Wednesday.
• In Australia, we hear from RBA Governor Stevens in one of his last speeches before the end of his term while on the data front, we get sentiment surveys and housing finance.
• In Japan, we see current account data, money supply and PPI.
• In Canada, little of note though we see housing data
• In the Scandies, both Sweden and Norway release inflation data, while Sweden also releases inflation expectations and industrial production for June.
• In Switzerland, inflation likely prints back in negative territory on the month

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Below is a detailed summary of the key events in the US in the coming week, courtesy of Goldman Sach

Monday, August 8

• 10:00 AM Labor market conditions index, July (last -1.9): The Fed’s Labor Market Conditions Index (LMCI), a blend of first and second derivatives, still remains at weak levels after falling to its lowest level since mid-2009 in May. As we noted recently, some aspects of the indicator’s methodology are probably understating the strength in the labor market, with trend payroll growth still roughly double the breakeven rate.
• 11:00 AM NY Fed survey of consumer expectations, July

Tuesday, August 9

• 06:00 AM NFIB small business optimism index, July (consensus 94.5, last 94.5)
• 08:30 AM Nonfarm productivity, Q2 preliminary (GS +0.4%, consensus +0.5%, last -0.6%): Unit labor costs, Q2 preliminary (GS +1.7%, consensus +1.8%, last +4.5%); We expect nonfarm productivity to increase by 0.4% in Q2 (qoq ar), following a moderate decline last quarter. After a strong 4.5% increase in Q1, we expect unit labor costs to rise 1.7%.
• 10:00 AM Wholesale inventories, June (consensus flat, last +0.1%): Consensus expects wholesale inventories to be flat in June.

Wednesday, August 10

• 10:00 AM JOLTS job openings, June (consensus 5,675k, last 5,500k)
• 02:00 PM Monthly budget statement, July (consensus -$129.0bn, last -$149.2bn): Consensus expects the federal budget deficit to have declined to -$129.0 in July.

Thursday, August 11

• 08:30 AM Initial jobless claims, week ended August 6 (GS 260k, consensus 265k, last 269k): Continuing jobless claims, week ended July 30 (consensus 2,130k, last 2,138k); We expect initial jobless claims to edge down to 260k from 269k last week, near post-crisis lows. Last week, initial claims picked up, although we suspect the increase was likely due in part to auto-plant shutdowns.
• 08:30 AM Import price index, July (consensus -0.4%, last +0.2%):  Consensus expects the import price index to decline by 0.4% in July, likely due to a decline in oil prices. The headline index has risen for the past four months, in part due to a modest recovery in petroleum prices.

Friday, August 12

• 8:30 AM Retail sales, July (GS +0.5%, consensus +0.4%, last +0.6%): Retail sales ex-auto, July (GS +0.1%, consensus +0.2%, last +0.7%); Retail sales ex-auto & gas, July (GS +0.2%, consensus +0.4%, last +0.7%); Core retail sales, July (GS +0.2%, consensus +0.3%, last +0.5%): We expect headline retail sales to rise by 0.5%, in large part reflecting solid July auto sales. Core retail sales are likely to soften modestly following several strong monthly readings. In addition, July’s decline in gasoline prices (-5.4%) is likely to pass-through to the core.
• 08:30 AM PPI final demand, July (GS flat, consensus +0.1%, last +0.5%);  PPI ex-food and energy, July (GS +0.1%, consensus +0.2%, last +0.4%); PPI ex-food, energy, and trade, July (GS +0.1%, last +0.3%): We expect PPI ex-food, energy, and trade to rise by a modest 0.1% pace in July. Headline PPI likely was flat in July, reflecting the modest softening in energy prices last month.
• 10:00 AM University of Michigan consumer sentiment, August preliminary (GS 92.5, consensus 91.5, last 90.0): We expect the University of Michigan consumer sentiment index to improve in the August preliminary estimate, following last month’s modest decline.
• 10:00 AM Business inventories, June (consensus +0.1%, last +0.2%): Consensus expects a 0.1% rise in inventory levels in June, following a 0.2% gain in May.
• 10:00 AM Philadelphia Fed survey of professional forecasters, Q3

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Finally, a detailed table recap of all the main global events in the next 5 days