Weekly outlook for August 8-12

The major news over the weekend came from the US when Standard & Poor’s downgraded the US credit rating from AAA to +AA for the first time in US history. The US treasury department already reacted to this news and posted a reply to S&P’s decision.   This week there are many news items ahead including, among others, the Fed’s rate decision, OPEC monthly report, China’s inflation rate, American and Canadian trade balance, and Australia employment report. Here is an economic news calendar for the week of August 8th to August 12th that highlights the main news items and reports related to U.S, Europe, Australia, China and Canada.   

(all times GMT):

  1. Monday 8th of August 3.00 – Chinese CPI: The ongoing rising inflation in China is likely to affect People Bank of China’s monetary policy as it will try to curb the rising prices; last month the PBC raised its interest rate for he fourth time in 2011; the consumer price index is still above the China’s inflation target of 4% in annual terms.  During June, the annual rate reached 6.4%, a rise compared with an annual rate of 5.5% during May 2011;
  2. Tuesday 9th of August tentative –OPEC monthly report: this report will show the changes in crude oil and natural gas’s demand and supply worldwide; the report will also examine the changes in the production of OPEC countries during July; the recent drop in crude oil prices might be stem, in part, from the increase in oil production; this upcoming report will show if these rumors have merit (See here a summary of the last report);
  3. Tuesday 9th of August 13:15 – Canadian Housing Starts: The upcoming report is regarding July 2011. In the recent report regarding June 2011, the seasonally adjusted housing starts reached 197,400 units, slightly higher than the 194,100 units started during May 2011. This report indicates not only the progress of the real estate market, but also of the Canadian economy; if the upcoming report will be continue to show growth, it may further strengthen the Canadian dollar  (see here last report);
  4. Tuesday 9th of August 17:30 – Decision on Federal Reverse’s Interest Rate: The current Fed’s basic interest rate is still at 0 to 0.25 percent; the recent news of Standard & Poor’s downgrading the US credit rating over the weekend, limits the ability of the Federal Reserve to raise its interest rate without further ramifications on the US’s credit rating; in the last Fed meeting, there were expectations for a decline in unemployment and in inflation, which came true to some extent. The recent stimulus plan, in which the Fed purchased $600 billion worth of corporate bonds and treasury securities, seems to have had only a short term effect on the US economy; this isn’t surprising considering the US GDP is $15 trillion, so that this stimulus plan is only stands for 4% of the GDP or a drop in water. In the upcoming FOMC meeting the committee will decide the interest rate level, and whether to take any further monetary steps to stimulate the US economy; many still speculate that an additional quantitative easing plan will eventually arise (see here previous meeting minutes);
  5. Wednesday 10th of August tentative –IEA monthly oil report: this upcoming report will present an updated (as of July) outlook for the crude oil supply and demand for 2011 and 2012. See here for the summary of the last report;
  6. Wednesday 10th of August 15:30 – EIA report about Crude oil inventories: The EIA (Energy Information Administration) will publish its weekly report on the U.S Petroleum market; last week the US oil stocks declined during last week by 1.94 million barrels; this is the largest extractions since April 15th, 2011. For the week ending on July 29th crude oil stockpiles reached 1,807 million barrels (see here the recent crude oil market review);
  7. Wednesday 10th of August 2:30 – Australia rate of unemployment: in the recent report regarding June 2011 the rate of unemployment remained unchanged at 4.9%; the number of unemployed slightly fell by 400 people and 4.6% below the number of unemployed in June 2010; the number of employed inclined by 3,800 people during June compared to May. If this trend ill continue to could further strengthen the Australian dollar (see here the recent report);
  8. Thursday 11th of August 9.00 – ECB monthly bulletin: This monthly bulletin analyzes the economic condition of the Euro Area including the price stability, internet rate decisions and the situation of governments debt such as Greece’s  (see here last report)  ;
  9. Thursday 11th of August 13.30 – Report on American Trade balance: This monthly report will show the changes in imports and exports of goods and services to and from the US, including major commodities such as crude oil during June 2011; The American trade balance report for May 2011 showed the goods deficit increased by $6.7 billion compared to April 2011 and reached $64.9 billion; the service surplus rose by $0.1 billion to $14.7 billion; as a result, the goods and services deficit increased by $6.6 billion to $50.2 billion;
  10. Thursday 11th of August 13.30 –Canadian Trade balance: In the July report regarding May 2011, imports and exports rose during that month: exports increased by 1.2%, and imports inclined by 1.1%; as a result, the trade deficit narrowed from $857 million in April to $814 million in May; exports of energy products fell by 3.6%, to $9.1 billion, while exports of industrial goods and materials rose by 4.0% to $9.5 billion;
  11. Thursday 11th of August 13:30 – Department of Labor report – U.S. unemployment claims: For the week ending on July 30th, initial claims decreased by 1,000, as it reached 400,000 claims; the insured unemployment rate remained unchanged at 3.0% for the week ending on July 23rd; and the number of insured unemployment was 3.730 million, an increase of 4,500 compared with the previous week’s. (see here my recent review on the US Labor market);
  12. Thursday 11th of August 15:30 – EIA report about Natural gas storage: the natural gas market in the US continues to cool down; the EIA will publish its U.S. natural gas stocks, production and consumption report for the week ending on August 5th. In the recent report, natural gas storage inclined for the seventeenth straight week by 1.6% to 2,758 billion cubic feet for all lower 48 states – the highest stock level since January 1st, 2011 (see here my recent natural gas storage review);
  13. Friday 12th of August 15:30 – Changes in US retail sales: this report shows the monthly changes in the retail sales and food services; for last month’s report regarding June, the retail sales, when controlling for the price changes, slightly inclined by 0.1% from the previous month; retail sales were up 0.2% from May 2011; gasoline stations sales were slightly down by 1.2% in June compared to May 2011, but were 23.6% above sales in June 2010  (see here recent report).

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