Major commodities including oil, natural gas, gold and silver declined during most of last week. Leading “risk related currencies” such as the Aussie dollar and Euro also fell last week. Will commodities rally this week? In the upcoming week several reports, events and speeches may affect the financial markets. These include: Bernanke’s speech, U.S CPI, Philly fed survey, EU GDP for Q1 2013, U.S housing starts, Canada’s manufacturing sales, Germany’s ZEW economic sentiment, Canada’s CPI, GB Claimant Count Change, U.S retail sales, Euro Group meetings, and U.S. jobless claims. Here is an economic forecast for the week of May 13th to May 17th regarding the U.S, Euro Area, Canada, Australia, and Great Britain.
(All times GMT):
Monday, May 13th
All Day – Euro-Group Summits: In this summit, the EU ministers of finance and Euro-Group President will convene in Brussels. They are expected to talk about the Cyprus debt relief program. They may also discuss the future steps needed to strengthen the EU banking system;
13:30 –U.S. Retail Sales Report: this report will present the monthly changes in the retail sales and food services for April; in the recent report regarding March, the retail sales slipped by 0.4% from the previous month; gasoline stations sales fell by 2.2% in March compared to February 2013; this report could signal the changes in U.S’s gasoline demand and thus may affect oil prices in the U.S;
Tuesday, May 14th
10:00 – German ZEW economic sentiment: The upcoming report will refer to the ZEW indicator of economic sentiment for Germany for April. In March the ZEW indicator for Germany sharply fell to 36.3 points; if Germany’s economic sentiment will fall further, the Euro will plausibly weaken against other currencies such as the USD;
10:30 – Australian Annual Budget Release: this report will outline the government budget of Australia for 2013; if there will be a hike in the budget deficit it could have an adverse effect on the Aussie dollar;
Tentative –IEA Monthly Oil Report: the upcoming monthly repot will show an updated (as of April) outlook and analysis for the global crude oil and natural gas market for 2013 and 2014;
Wednesday, May 15th
09:30 – Great Britain Claimant Count Change: This report will shows the changes in the number of unemployed in GB; as of the previous month’s report this figure had declined by 7k; the rate of unemployment inched up to 7.9% in the recent report;
Tentative – Bank of England Inflation Report: this report will show the yearly rate of GB’s inflation based on the estimate of Bank of England for the next two years;
10:00 –EU First Quarter GDP 2013: during the fourth quarter of 2012, EU’s economy contracted by 0.6%; if the EU economy will continue to shrink this could adversely affect the Euro;
10:30 – Governor King speaks: Bank of England’s Governor will hold a press conference about the Bank’s inflation report; he may also offer talk about the upcoming MPC monetary policy meeting; this speech may influence British Pound traders;
13:30 – Canada Manufacturing Sales (March 2013): This report will refer to the manufacturing sales in Canada as of March. It may affect the USD/CAD currencies pair, which is strongly correlated with commodities prices. In the latest report regarding February 2013, manufacturing sales sharply rose by 2.6%;
13:30 – U.S. Producer Price Index: This report will show the developments in the PPI during April 2013, i.e. the inflation rate from the producers’ side. In the previous report regarding March, this index for finished goods declined by 0.6% compared with February’s rate and by 1.1% in the past 12 months; this news might affect the direction of commodities rates;
14:00 – U.S. TIC Long Term Purchases: The Treasury International Capital monthly report will show the shifts in the purchases and sales of US long term treasuries for March 2013. In the recent report regarding February 2013, the net foreign sales of U.S Treasuries longer-term notes fell by $17.8 billion;
15:30 – U.S Crude Oil Stockpiles Weekly Update: the EIA (Energy Information Administration) will publish its weekly report on the U.S oil and petroleum stockpiles for the week ending on May 10th; in the recent report for May 3rd, stockpiles rose by 3.5 ml bl to reach 1,795.6 ml bl.
Thursday, May 16th
10:00 – Euro Area CPI: according to the latest update the annual CPI slipped again to 1.7%, which is slightly lower than ECB’s target inflation; if the inflation will continue to decline, it could raise the chances of ECB cutting again its cash rate in the near future;
13:30 – U.S. Housing Starts: the U.S Census Bureau will come out with its U.S housing starts monthly report for April 2013; this report was historically correlated with gold price – as housing starts increase, gold prices tended to fall the next day (even when controlling to the U.S dollar effect); in the previous monthly report, the adjusted annual rate reached 1,036,000 in March 2013, which was 7% from February’s rate;
13:30 – U.S. Building Permits: in the recent update, building permits fell during March by 3.9% (M-o-M) in the adjusted annual rate of building permits was 902,000. If building permits will continue to fall, it may indicate that the U.S housing market (from this aspect) isn’t recovering (the recent U.S building permits update);
13:30 –U.S Core Consumer Price Index: This monthly report will refer to the main changes in the core consumer price index for April 2013. Based on the U.S Bureau of Labor statistics during March, the CPI slipped by 0.2% (M-o-M); the core CPI edged up by 0.1%; the core index rose over the past twelve months by 1.5%.
13:30 – U.S. Jobless Claims Weekly Report: this weekly update will pertain to the shifts in the initial jobless claims for the week ending on May 4th; in the recent report the jobless claims declined by 4k to reach 323k; this upcoming weekly report may affect the path of U.S dollar and consequently commodities and stocks markets;
15:00 – Philly Fed Manufacturing Index: This monthly survey shows an estimate for the growth of the US manufacturing sectors. In the recent April survey, the growth rate slightly fell from 2.0 in March to 1.3 in April. If the index will increase it may positively affect not only U.S Dollar but also American stocks and commodities markets (the previous Philly Fed review);
15:30 – EIA U.S. Natural Gas Storage: the EIA weekly report of the U.S. natural gas market will pertain to the latest developments in natural gas production, storage, consumption and prices as of May 11th; in latest weekly report, natural gas storage rose by 88 Bcf to 1,865 Bcf;
Friday, May 17th
13:00 – Canada’s core CPI: This report will refer to the CPI and core consumer price index (controlling the volatile components such as energy, fruit and vegetables) for April 2013. Based on the previous Canadian CPI report for March 2013, the core CPI slightly increased by 0.2% during the month. This report might affect the Canadian dollar, which is also strongly correlated with commodities rates;
14:55 – UoM Consumer Sentiment (preliminary):University of Michigan will publish its preliminary consumer sentiment monthly report; this survey could offer an insight to latest developments in U.S consumers’ sentiment; according to the recent update, the sentiment index changed direction and slightly rose to 72.3;
Saturday, May 18th
15:00 – Bernanke’s Speech: Chairman of the Federal Reserve Ben Bernanke will talk in Bard College, in New York. The title of his speech is “Economic Prospects for the Long Run “. Following the latest FOMC meeting from earlier this month, if the Chairman of Fed will provide some insight regarding the future steps of the FOMC this could stir up the precious metals market;
For further reading:
- Gold and Silver Outlook for May
- Gold and Silver Yearly Outlook For 2013
- QE3 Is Here, So Why Gold isn’t Pulling Up?
- Why Gold Isn’t Pulling Up?
- Will Gold Producers Continue Their Recovery?