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Week Ahead – Moment of Truth

US

After a round of soft inflation data triggered a buy-everything relief rally, Wall Street will focus on Fed speak and a plethora of data points that might show the economy remains resilient.  The key economic readings include manufacturing activity, retail sales, and housing data.

There will be no shortage of appearances by the Fed this week. Brainard and Williams speak on Monday, while Tuesday includes speeches by Harker, Cook, and Barr. Wednesday brings Williams, Barr, and Waller, and on Thursday we will hear from Bullard, Bowman, Mester, Jefferson, and Kashkari.

In addition to a swathe of economic releases, traders will also closely monitor big retail earnings from Walmart, Target, Macy’s, and Kohl’s. We should learn more about the health of the consumer and if we should expect a further easing of prices as we enter the holiday season.

EU 

It’s a relatively quiet week for the EU with the two standout economic releases being flash GDP and final HICP. With the economy facing a recession, the GDP data will be an interesting insight into how quickly growth is slowing going into an uncertain winter. The inflation data will naturally be of interest but it may take a significant revision to really grab investors’ attention.

UK

The Autumn statement has been a long time coming, it feels. The markets have calmed down a lot since the ridiculous mini-budget but it will still take time for the government to regain credibility and the confidence of the markets. It starts next week and all eyes will be on Parliament as we learn how the new government plans to balance the books while not piling more misery on the economy.

The BoE monetary policy report hearing next week is another highlight but there’s also a lot of economic data due. The path for interest rates remains uncertain so it’s not just what policymakers have to say that matters, it’s whether the data allows them to slow the pace of tightening going forward as they so clearly want to do. CPI on Thursday is the obvious highlight but there’s plenty more throughout the week.

Russia

A quiet week with no economic data of note.

South Africa

Another quiet week with the only economic release being retail sales on Wednesday.

Turkey

No major economic releases next week, with investors still focused on the central bank and inflation.

Switzerland

Tier three data dominate next week. Focus remains on what the SNB will do in December, with Chair Jordan acknowledging on Friday that monetary policy isn’t restrictive enough to bring inflation back into the range of price stability over the medium term. The risk of a pre-meeting rate hike remains.

China

Weeks of speculation around China’s commitment to its zero-Covid policy have spurred a recovery in local stocks and we may be about to get more information on what that will entail. A relaxation of quarantine measures has been announced in recent days and a press briefing is now reportedly scheduled for Saturday. At the same time, China is seeing a steady rise in Covid cases resulting in more restrictions and mass testing.

China’s October retail sales, industrial production, and investment data will be released next week.  The PBOC is also expected to keep its one-year medium-term lending facility rate at 2.75% in November.

India

A key inflation report could show pricing pressures are easing which might allow the RBI to be less aggressive with its tightening path.  Headline inflation is expected to ease from 7.4% to 6.7%.

Australia & New Zealand

The focus for both Australia and New Zealand might stay on China and their weakening outlook due to their struggles with COVID.

Australian employment data is expected to show job growth continues, while unemployment remains at 3.5%. Wage pressures in the third quarter are expected to rise, but some of that is attributed to the increase in the minimum wage.

In New Zealand house sales data and producer prices will be released.

Japan

Japan’s third-quarter GDP reading is expected to show significant weakness as import costs skyrocketed.  Japan’s core inflation is also expected to surge from 3.0% to 3.5%, which should clearly weigh on consumer spending.  Given the weakness in the US dollar, the BOJ might save its ammunition and hold off intervening anymore in the foreign exchange market.

Singapore

It is expected to be a quiet week with the exception of non-oil domestic export data.

Economic Calendar

Sunday, Nov. 13

Economic Data/Events

  • China medium-term lending
  • The ASEAN summit concludes in Cambodia.

Monday, Nov. 14

Economic Data/Events

  • Eurozone industrial production
  • India trade, CPI, wholesale prices
  • New Zealand performance services index
  • Fed’s Williams moderates a panel at the Economic Club of New York
  • ECB’s Fabio Panetta speaks in Florence
  • ECB’s de Guindos speaks in Frankfurt.
  • BOJ announces the outright purchase amount of Japanese government securities

Tuesday, Nov. 15

Economic Data/Events

  • US empire manufacturing, PPI
  • France CPI
  • Poland CPI
  • Eurozone GDP
  • Hungary GDP
  • Canada existing home sales
  • China retail sales, industrial production, surveyed jobless
  • France unemployment
  • Germany ZEW survey expectations
  • Japan industrial production, GDP
  • Mexico international reserves
  • New Zealand home sales, net migration
  • South Korea export/import price index, money supply
  • UK jobless claims, unemployment
  • G-20 summit in Bali
  • IEA monthly oil market report
  • ECB’s Elderson speaks
  • Fed’s Harker speaks at GIC Annual Monetary & Trade Conference
  • Former US President Trump is due to make an announcement in Florida
  • RBA releases minutes of its November interest rate meeting

Wednesday, Nov. 16

Economic Data/Events

  • US business inventories, cross-border investment, retail sales, industrial production
  • Australia leading index
  • Canada CPI, housing starts
  • China property prices
  • Israel GDP
  • Italy CPI
  • Japan machinery orders, tertiary index, department store sales
  • Philippines Bloomberg economic survey
  • Russia GDP
  • South Africa retail sales
  • UK CPI
  • EIA crude oil inventory report
  • G-20 summit in Bali
  • BOE Gov Bailey appears before the Treasury committee
  • Fed’s Williams and Brainard, SEC’s Gensler speak at the 2022 Treasury Market conference
  • ECB Financial Stability Review
  • ECB President Lagarde speaks
  • ECB’s Fabio Panetta speaks

Thursday, Nov. 17

Economic Data/Events

  • US housing starts, initial jobless claims
  • Italy trade
  • Singapore trade
  • Australia unemployment
  • China Swift payments
  • Eurozone CPI, new car registrations
  • Hong Kong jobless rate
  • Japan exports, trade balance
  • New Zealand PPI
  • Singapore non-oil exports
  • UK fiscal statement, economic forecasts
  • Fed’s Kashkari and Jefferson speak at the Federal Reserve Bank of Minneapolis Fall Institute Research Conference
  • Fed’s Mester speaks at the Federal Reserve Bank of Cleveland and the Office of Financial Research Annual Financial Stability Conference
  • Fed’s Evans speaks ahead of his retirement
  • BOE’s Silvana Tenreyro speaks
  • SNB’s Maechler speaks at Money Market Event in Geneva
  • BOE’s Huw Pill speaks at the Bristol Festival of Economics on ‘What Next for Central Banks’

Friday, Nov. 18

Economic Data/Events

  • US Conference Board leading index, existing home sales
  • Norway GDP
  • Japan CPI
  • Thailand foreign reserves, forward contracts, car sales
  • ECB President Lagarde, Nagel, and Knot speak alongside BOE’s Mann Fed’s Collins speaks at the Federal Reserve Bank of Boston Economic Conference
  • BOE’s Jonathan Haskel speaks

Sovereign Rating Updates

  • Italy (Fitch)
  • Sweden (Fitch)
  • Turkey (Fitch)
  • Ireland (S&P)
  • South Africa (S&P)
  • Portugal (Moody’s)
  • South Africa (Moody’s)
  • Denmark (DBRS)

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