Inflation (PCE) and GDP data in the US and European CPI highlight another fairly quiet week for data next week. OPEC meeting, the Nafta negotiations on Monday and comments from various European leaders and EU delegates will also be a focus throughout the week according to DB’s Craig Nicol. Clearly any developments concerning the US political drama of last week will also be closely watched by markets.

The highlight of another fairly quiet week for data next week is likely to be the July PCE report in the US on Thursday. Consensus expectations is for a +0.2% mom core reading which should help to push the annual rate up one-tenth and to  the Fed’s target of +2.0% yoy. Released alongside that data will be the July personal income (+0.4% mom expected) and spending (+0.4% mom expected) reports. The other potentially interesting data point in the US next week is the July advance goods trade balance reading on Tuesday which will be one of the first updates since the imposition of tariffs on China. Other data worth flagging in the US next week is the August consumer confidence print on Tuesday (a small decline in confidence expected), second reading of Q2 GDP (expected to be revised down one-tenth to +4.0% qoq) on Wednesday, and final August University of Michigan consumer sentiment survey revisions on Friday.

In Europe inflation data should also be the focus with the preliminary August CPI report due for the Euro area on Friday (core reading of +1.1% yoy expected to remain unchanged). Country level CPI reports are also due in Germany and Spain on Thursday and France and Italy on Friday. Outside of that we’ll get the August IFO survey for Germany on Monday, and confidence indicators for the Euro area and money and credit aggregates data for the UK on Thursday. In Asia next week the highlight is the release of the official August PMIs for China on Friday.

Other potentially interesting things to keep an eye on next week include the German government’s annual open house on Sunday which will include news conferences from Finance Minister Scholz, Economy/Energy Minister Altmaier and Chancellor Merkel. On Monday France President Macron is due to make his annual foreign policy speech in Paris while the Joint Technical Committee of OPEC and its allies also meet in Vienna to discuss compliance with the production accord. On Tuesday European Commissioner Oettinger is scheduled to discuss the EU budget at a conference in Brussels while on Wednesday EU Trade Commissioner Malmstrom is due to speak at an international trade event in Stockholm. Wednesday is also the deadline for when prosecutors for President Trump’s former campaign manager Manafort must decide whether or not to retry him on ten unresolved counts. On Thursday it could be worth watching the two-day EU foreign affairs ministers’ meeting with the group due to discuss the Middle East, trans-atlantic relations, the Iran nuclear deal and North Korea amongst other topics.

Lastly, it’s worth flagging that markets in the UK will be closed on Monday for the bank holiday.

Courtesy of Deutsche Bank, here is a breakdown of key events by day

  • Monday: It’s a quiet start to the week for data on Monday. Overnight we’ll get July industrial profits data in China while the only release of note in Europe is the August IFO survey in Germany. In the US we’ll get the July Chicago Fed national activity index and August Dallas Fed manufacturing activity index prints. Away from that, France President Macron will make his annual foreign policy speech in Paris. It’s worth also adding that markets in the UK will be closed for a bank holiday on Monday.
  • Tuesday: There is no data of note in Asia on Tuesday. In Europe we’ll get August consumer confidence data for France and July M3 money supply data for the Euro area. Data in the US on Tuesday includes the July advance goods trade balance, preliminary July wholesale inventories report, August Richmond Fed manufacturing index print and the August Conference Board consumer confidence survey. Away from the data we’ll also hear from ECB board member Peter Praet when he speaks around lunchtime in Germany. European Commissioner Gunther Oettinger will also discuss the EU budget at a conference in Brussels.
  • Wednesday: Much of the focus on Wednesday will be on the second revision to Q2 GDP in the US. Outside of that there is nothing of note in Asia while in Europe September consumer confidence data in Germany and the second revision to Q2 GDP for France are due. Also due in the US is July pending home sales data and the latest weekly mortgage applications data. Away from this the BoJ’s Suzuki will speak in Japan overnight, while EU Trade Commissioner Malmstrom is scheduled to speak at an international trade event in Stockholm. Wednesday is also the deadline for when prosecutors for President Trump’s former campaign manager Paul Manafort must decide whether or not to retry him for ten unresolved counts.
  • Thursday: It’s a busy day for data releases on Thursday with the highlight coming in the afternoon with the July PCE report in the US. Overnight we’ll also get July retail sales data for Japan while in Europe we’ll get the preliminary August  CPI report for Germany as well as the August unemployment rate, along with July money and credit aggregates data for the UK and August confidence indicators for the Euro area. Meanwhile in the US, along with the PCE report we’ll also get the July personal income and spending numbers, as well as the latest weekly initial jobless claims print. Away from this EU foreign affairs ministers are due to meet at a conference (continuing into Friday) to discuss topics including the Middle East, trans-Atlantic relations, the Iran nuclear deal and North Korea.
  • Friday: The calendar remains fairly busy into the end of the week on Friday. Overnight we’ll get July industrial  production for Japan, August PMIs for China and the GfK consumer confidence print for the UK. During the European session much of the focus will be on the August CPI report for the Euro area, while we’ll also get CPI prints from France and Italy as well as the July unemployment rate for the Euro area. Finally in the US we get the August Chicago PMI and the final August University of Michigan survey revisions. Late in the evening, ECB board member Luis Guindos will speak in Spain.

Focusing just on the US, here is a summary preview from Goldman, which notes that the key economic releases for the coming week are the second estimate of Q2 GDP growth on Wednesday, and core PCE on Thursday. There are no scheduled speaking engagements by Fed officials this week, following last week’s Jackson Hole Economic Symposium.

Monday, August 27

  • There are no major economic data releases scheduled.

Tuesday, August 28

  • 08:30 AM Advance goods trade balance, July (GS -$70.7bn, consensus -$69.0bn, last -$67.9bn): We estimate that the goods trade deficit increased $2.8bn in July to $70.7bn, reflecting a likely decrease in soybean exports following a sharp increase in June ahead of Chinese retaliatory tariffs.
  • 08:30 AM Wholesale inventories, July preliminary (consensus +0.2%, last +0.1%)
  • 09:00 AM S&P/Case-Shiller 20-city home price index, June (GS +0.2%, consensus +0.2%, last +0.2%): We expect the S&P/Case-Shiller 20-city home price index increased 0.2% in June, following a 0.2% increase in May. Our forecast of a modest increase reflects a slowdown in the pace of home price appreciation in other measures such as the June FHFA house price index.
  • 10:00 AM Conference Board consumer confidence, August (GS 126.6, consensus 126.5, last 127.4): We estimate that the Conference Board consumer confidence index decreased by 0.8pt to 126.6. We expect the index to remain close to its post-crisis highs, reflecting both the high level of other consumer sentiment measures and strong recent stock market performance.
  • 10:00 AM Richmond Fed manufacturing index, August (consensus +18, last +20)

Wednesday, August 29

  • 08:30 AM GDP (second), Q2 (GS +3.9%, consensus +4.0%, last +4.1%); Personal consumption, Q2 (GS +3.8%, consensus +3.9%, last +4.0%): We look for Q2 GDP to be revised down by two tenths to +3.9% in the second vintage of Q2 GDP, due to potential downward revisions in consumption, housing, and inventories. We expect personal consumption to be revised down by two tenths to 3.8%, reflecting softer consumer spending results of the Quarterly Services Survey.
  • 10:00 AM Pending home sales, July (GS flat, consensus +0.3%, last +0.9%): We estimate that pending home sales were flat in July, following a 0.9% increase in the June report, due to mixed regional home sales data so far in July. We have found pending home sales to be a useful leading indicator of existing home sales with a one- to two-month lag.

Thursday, August 30

  • 08:30 AM Personal income, July (GS +0.3%, consensus +0.4%, last +0.4%); Personal spending, July (GS +0.4%, consensus +0.4%, last +0.4%); PCE price index, July (GS +0.12%, consensus +0.1%, last +0.10%); Core PCE price index, July (GS +0.15%, consensus +0.2%, last +0.11%); PCE price index (yoy), July (GS +2.30%, consensus +2.3%, last +2.23%); Core PCE price index (yoy), July (GS +1.96%, consensus +2.0%, last +1.90%): Based on details in the PPI and CPI reports, we forecast that the core PCE price index rose 0.15% month-over-month in July, or 1.96% from a year ago. Additionally, we expect that the headline PCE price index increased 0.12% in July, or 2.30% from a year earlier. We expect a 0.3% increase in July personal income and a 0.4% gain in personal spending.
  • 08:30 AM Initial jobless claims, week ended August 25 (GS 210k, consensus 214k, last 210k); Continuing jobless claims, week ended August 18 (consensus 1,730k, last 1,727k): We estimate that initial jobless claims stayed at 210k in the week ended August 25. Initial jobless claims continue to decline steadily, and we believe there is additional scope for this trend to continue.

Friday, August 31

  • 09:45 AM Chicago PMI, August (GS 63.5, consensus 63.0, last 65.5); We estimate that the Chicago PMI moved down 2pt to 63.5 in August. While recent releases of regional manufacturing surveys have generally shown slower growth, industrial sales commentary remains solid.
  • 10:00 AM University of Michigan consumer sentiment, August final (GS 95.7, consensus 95.5, last 95.3); We expect the University of Michigan consumer sentiment index to edge up 0.4pt from the preliminary estimate for August, reflecting a sharp rebound in stock prices in mid-August. The report’s measure of 5- to 10-year inflation expectations stood at 2.5% in August.

Source: DB, Goldman, BofA



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