The data and events calendar is very light this week, with the exception of Friday which sees the release of UK data for Q2 GDP and June industrial output and international trade and US CPI-inflation figures for July. The RBA and RBNZ meet on Tuesday and Wednesday, respectively, with neither expected to hike rates.
Australia: Reserve Bank of Australia policy meeting. The RBA is very likely to leave rates on hold at 1.50% with markets focussing on the accompanying policy statement.
Australia: Reserve Bank of Australia Governor Lowe speaks.
Wednesday 8th August
New Zealand: Reserve Bank of New Zealand policy meeting and press conference. The RBNZ is very likely to leave rates on hold at 1.75%, with the rates market seemingly dormant in recent months.
United States: FOMC member Barkin speaks
Thursday 9th August
United States: FOMC members Evans speaks
Friday 10th August
United Kingdom: Q2 GDP (first reading). The consensus forecast, which the NIESR shares, is that the GDP growth rate doubled to 0.4% quarter-on-quarter from a lacklustre 0.2% in Q1. But this would still be a modest rate of growth, which would translate into roughly 1.3% year-on-year – amongst the weakest growth rates within developed economies. Moreover, these are now “old” data which the Bank of England would have taken into when hiking rates last week. Markets are more likely to care about forward-looking macro data for Q3 and ultimately about Brexit-related developments.
United Kingdom: Industrial output (June). Again a datapoint which markets may feel is ultimately “old” and in any case industry accounts for only a modest 15% of the UK economy. Consensus forecast is that industrial output rose 0.4% mom in June, reversing the 0.4% contraction recorded in May.
United Kingdom: Trade balance (June). There has been little evidence that Sterling’s post-referendum collapse and competitiveness gain have benefited UK international trade with the deficit broadly unchanged since mid-2016. Consensus forecast is that the deficit on goods and services was broadly unchanged in June at £12bn.
United States: CPI-inflation (July). Measures of US inflation were broadly unchanged in June which may at the margin be capping market expectation of Federal Reserve rate hikes. The consensus forecast is that headline CPI-inflation inched up to 3.0% yoy in July from 2.9% yoy in June but that core CPI-inflation was unchanged at 2.3% yoy. The US labour market is arguably very tight and employment growth remains solid but wage growth has not accelerated which in turn is probably capping US inflation.
