Tariffs make the world go round...
Happy Friday, everyone! I hope you're all doing well as we look to get things going in the session ahead. It's a nervy time for markets as Trump pulled off a surprise overnight by announcing a fresh round of tariffs against China, prompting risk assets to fall rapidly and haven assets to gain amid a more sour market mood.
The risk-off sentiment is continuing into the new day with haven currencies leading the charge so expect that to cast a shadow on markets ahead of the US non-farm payrolls report later on in North American trading.
Looking ahead, we'll have some light data from the euro area to move things along before the focus turns towards the US jobs data release at 1230 GMT.
0630 GMT - Switzerland July CPI figures
Prior report can be found here. It was Swiss National Day yesterday, so the country's data releases have been postponed to today. Inflationary pressures are expected to ease a little relative to June but it isn't anything too impactful to markets.
0730 GMT - Switzerland July manufacturing PMI
Prior release can be found here. Much like the rest of the region, factory activity is expected to continue its slump in Switzerland and this will only add to the worsening outlook for the global economy amid escalating trade tensions between US and China.
0800 GMT - Italy June industrial production data
Prior release can be found here. A general indication of factory activity in the Italian economy but this is a lagging indicator as we had Q2 GDP data earlier in the week already.
0830 GMT - UK July construction PMI
Prior release can be found here. The print for July is expected to show a rebound from June, which was the weakest since April 2009. Nonetheless, the sector should remain in contraction territory and underscore further weakness in the UK economy amid ongoing Brexit uncertainty - similar to the manufacturing sector.
0900 GMT - Eurozone June PPI figures
Prior release can be found here. A proxy for inflationary pressures but one that matters little as we already had CPI data (more important) for July earlier in the week.
0900 GMT - Eurozone June retail sales data
Prior release can be found here. A gauge of consumption activity in the euro area but it is a lagging indicator considering that we had Q2 GDP data earlier in the week already.
Besides the above, be mindful about the response from the Chinese camp towards Trump's actions yesterday. Any signal that puts the September trade talks in jeopardy will add further pain for risk assets and boost risk-off flows.
I wish you all the best of days ahead and good luck with your trading!
