8th - 12th August
This week the New Zealand Reserve Bank is anticipated to follow the Australian Reserve Bank in cutting rates as New Zealand’s inflation outlook deteriorates even more. The main data of the week will be the Industrial output numbers from China, the UK and the Eurozone. Monday China’s monthly trade data is due on Monday and is expected to show the decline in exports and imports moderating, the steadily improving trend could be as a result of the weaker yuan but a strong turnaround in exports still seems some distance away. Meanwhile, the Eurozone sentix index out on Monday will likely confirm that business confidence in the euro area is recovering from the dip seen in June in the immediate aftermath of the Brexit vote. Tuesday The UK’s industrial production figures might be the most interesting data point to watch on Tuesday as it covers the period immediately before and after the Brexit referendum. Also to look out for on Tuesday are the latest UK trade figures and from the US its labor costs and productivity data for the second quarter. Wednesday June was a poor month for industrial production across much of the Eurozone but a sizeable rebound is expected in July with France the region’s second largest economy expected to report a rise in output. Also from Australia the RBA Governor will give a speech and followed at the end of the day with the US JOLTS job openings for June. Thursday The Reserve Bank of New Zealand is expected to cut rates for the second time this year to a new record low of 2.0% from 2.25%. The latest round of easing comes amid weakening inflationary pressures in New Zealand. From the US the initial jobless claim will be released which will measure the strength of the US labor market. Friday Released on Friday is the second estimate of Eurozone GDP growth for the second quarter. No revision is expected to the preliminary estimate, which showed Eurozone growth had halved. From China the world’s second largest economy the industrial output is forecast to slow and retail sales are not expected to buck the trend either. The main US highlight will come on Friday with the release of the July retail sales numbers and the consumer sentiment survey, the consumer spending in the United States remains robust despite disappointing GDP growth in the first half of the year. A strong figure should boost the dollar as it would keep alive the possibility of a 2016 rate hike.
