UPCOMING EVENTS:
- Monday: BoJ Meeting Minutes.
- Tuesday: Japan Wage data, Chinese Trade data, RBA Policy Decision, Switzerland Unemployment Rate, Eurozone PPI.
- Wednesday: Eurozone Retail Sales, BoC Summary of Deliberations.
- Thursday: BoJ Summary of Opinions, Chinese Inflation data, US Jobless Claims, New Zealand Manufacturing PMI.
- Friday: UK GPD Q3 Preliminary, University of Michigan Consumer Sentiment.
Tuesday
The market’s expectation for a 25 bps rate hike from the RBA stands basically at 50%. The market was pricing a higher chance of a rate hike following the “hot” CPI report, but the odds were pared back once Governor Bullock noted that the data was a little higher than expected but about where they thought it would be. Moreover, the latest jobs data disappointed once again as the labour market continues to weaken. All in all, the RBA is likely to pass and wait for another labour market report and the monthly CPI data before deciding whether another rate hike is needed.
Thursday
The US Jobless Claims last week missed expectations once again with Continuing Claims now rising at a fast pace. Moreover, the NFP report last Friday missed forecasts almost across the board in another sign that the labour market is indeed weakening. This week, the consensus sees Initial Claims at 215K vs. 217K prior, while Continuing Claims are seen at 1815K vs. 1818K prior.
Friday
The University of Michigan Consumer Sentiment report has lost its market moving effect in this part of the cycle. One reason is because the market is more focused on the weakening jobs data, which on a forward-looking basis is likely to bring inflation down to target. Nevertheless, it remains an important survey for consumers’ personal finances outlook. The consensus sees Consumer Sentiment to tick higher to 64.0 vs. 63.8 prior.
