The focus this week will be on US and Eurozone data, with both due to release key measures of consumer price inflation for July, with US trade balance data for July and the second reading for Q2 GDP also due out.
Monday 27th August
Eurozone: German IFO Business Climate Index (August) – in weekly recap, 20-26th August
Tuesday 28th August
United States: Merchandise trade balance (July). The US trade deficit has shown little sign of improvement in the past two years and analysts forecast the deficit to have been broadly stable at around $68bn. Unlikely to be music to US President Trump’s ears.
Wednesday 29th August
United States: Q2 GDP (second reading). GDP growth rose to 4.1% qoq annualised according to the first estimate and analysts expect only a minor downgrade to 4.0% with markets now more likely to focus on macro data for Q3 and beyond.
United States: Pending home sales (July)
Thursday 30th August
Australia: ANZ business confidence (August) and building approvals (July)
United States: Personal income and expenditure and PCE inflation (July). Measures of US consumer price inflation were unchanged or rose only marginally in June. The Fed, which closely tracks measures of Personal Consumption Expenditure (PCE) inflation, will likely want to see a continued gradual rise in the headline and core measures from 2.2% yoy and 1.9% yoy, respectively, in June in order to comfortably shoe in two more rate hikes before year-end.
Friday 31st August
Eurozone: CPI-inflation (August, preliminary). Consensus forecast is that headline and core CPI-inflation were unchanged in August at respectively 2.1% yoy and 1.1% yoy. Stable inflation at these levels would probably be sufficient for the ECB to stick to its plan of fading its QE bond purchases as of October but the ECB will probably want to see higher Eurozone inflation before it starts to seriously consider any rate hikes.
