Another important week for the UK, with Brexit politics likely to dominate the headlines on Monday. July GDP data and August labour market figures are also due for release. In the US, CPI-inflation data – out Thursday – will likely get the most attention. In the Eurozone, the ECB holds its policy meeting on Thursday and there are mounting expectations that President Draghi will announce a loosening of monetary policy.
Monday 9th September
United Kingdom: Prime Minister Johnson is expected to again try to push through a parliament a bill which would bring forward general elections to later this year. However, the main opposition parties have said they would again vote against. At the same time, a bill which would force the government to seek a 3-month extension to Article 50 negotiations with the EU (should parliament fail to approve a Brexit deal) is expected to become law, effectively ruling out a “no-deal” Brexit until at least 31st January 2020. Parliament will then be suspended no later than 12th September until 14th October.
Switzerland: Labour market data (August)
Eurozone: German trade data (July). Germany continues to run a monthly trade surplus of about EUR 18bn thanks in part to tight fiscal policies and a high-saving rate but export and import growth has been more subdued in recent months in line with German economic activity.
United Kingdom: GDP (July). GDP was unchanged in June and this will provide the first official indication of how GDP growth fared in early Q3. Monthly macro data, including UK PMIs, suggest that GDP growth remained very weak in July and there has been increasing talk of the UK going into recession in Q3 after GDP contracted 0.2% qoq in Q2.
Tuesday 10th September
United Kingdom: Labour market data (July). Slowly rising weekly earnings growth and an unemployment rate of only 3.9% have been one of the few bright spots on the British economic landscape. Another strong set of numbers may help Sterling extend its recent gains but ultimately Brexit-related news is likely to remain the main driver of UK asset prices.
Wednesday 11th September
No tier-one macro data scheduled for release
Thursday 12th September
Eurozone: European Central Bank policy meeting, statement and press conference. The ECB has arguably been under increasing pressure to announce a cut to its policy rates and/or a resumption of its QE program in the face of slowing Eurozone growth and tepid inflation. There has been some speculation that ECB President Draghi, who steps down at end-October, may use this meeting to announce such moves.
United States: CPI-inflation (August). Core CPI-inflation has been in a narrow 2.0-2.2% yoy range since last September while the more volatile headline CPI-inflation has been in a 1.5-2.0% yoy range year-to-date. Analysts forecast an up-tick in core to 2.3% yoy in August from 2.2% yoy in July. Nevertheless, markets are still pricing in a 25bp Fed rate cut at its September policy meeting.
Friday 13th September
United States: Retail sales (August). US retail sales have increased in the past five consecutive months, by a total of about 3.4%, thanks in part to still buoyant consumer confidence. Analysts expect it to be six in a row, forecasting 0.2% mom growth in August. Could give the Fed something to think about.
