Financial Market Outlook for August 29- September 2

The talks over a possible rate hike in the past week have also helped pull up the USD and bring down commodities prices. And this week’s NFP report will play a key role in moving market expectations regarding a possible rate hike by the Fed this year. Besides the NFP, other reports and events to consider include: U.S. GB and China manufacturing PMI, U.S. PCE, U.S. factory orders, Canada’s GDP and EU and German CPI. So let’s review the main events for the week of August 29th to September 2nd.

(All times GMT):

Monday, August 29th

13:30 – U.S. core PCE: The personal consumption expenditures index is an important indicator the FOMC follows to determine the development in the U.S. inflation. In the past report, the core PCE (excluding food and energy) edged up by 0.1%. The expectations are for the core PCE to inch up again by 0.1%;

Tuesday, August 30th

10:00 – German CPI Flash Estimate: in the previous report the CPI came up higher than expected at 0.3% and is expected to reach only 0.1% in the next monthly update;  

15:00 – U.S. Consumer Confidence: According to the latest report for July, consumer confidence index slipped to 97.3. The current estimates are that the index moderately decline to 97.2;

Wednesday, August 31st

07:00 – German Retail Sales: Retail sales slipped by 0.1% in the past update and is estimated to bounce back by 0.5% in the upcoming monthly report;

10:00 – EU CPI Flash Estimate: This index estimates the yearly consumer price index of the Euro Area. Based on the previous estimate for July, the annual CPI inched up to 0.2% and core CPI remained flat at 0.9%. The market estimates the CPI were to rise to 0.3%;  

13:30 – Canada’s GDP by Industry: This monthly report presents the developments in major industrial sectors for June 2016. In the previous update regarding May 2016, the real gross domestic product declined by 0.6%;

13:15 – ADP estimate of U.S. non-farm payroll: ADP will release its estimate for the next U.S non-farm payroll changes for August 2016 that will be published on Friday;

15:30 – U.S Crude Oil Stockpiles Weekly update: The EIA (Energy Information Administration) will release its weekly report on the U.S oil and petroleum stockpiles for the week ending on August 26th;

Thursday, September 1st

02:00 – China’s Manufacturing PMI: In the previous report, the PMI slipped to 49.9; current estimates are for the PMI to remain flat at 49.9;

02:30 – Australia’s Retail Sales: In the recent report for July 2016, retail sales rose by 0.1%; this time the market anticipates a gain of 0.3%;

02:45 – China’s Caixin  Manufacturing PMI: This report is one of the main reports coming out of China mainly because it’s not conducted by China’s government; last month the PMI rose to 50.6, but in the upcoming report the PMI is expected to decline to 50.1 – which means the PMI is still growing albeit at a slower pace;

09:30 – GB Manufacturing PMI: In the first estimate for August, Great Britain’s manufacturing index dropped to 48.2 – manufacturing is contracting; the market expects the PMI to slightly rise to 49.1;

15:30 – EIA U.S. Natural Gas Storage: The EIA weekly report of the U.S. natural gas market will refer to the recent changes in natural gas production, storage, consumption and rates as of August 26th;

13:30 – U.S. Jobless Claims Weekly Report:  This weekly report will refer to the developments in the initial jobless claims for the week ending on August 26th; in the past report, jobless claims decreased to 261K; in the next report, estimates are for 265K claims;

15:00 – U.S. ISM Manufacturing PMI: Back in July, the PMI decreased to 52.6 — the manufacturing sector is expanding at a slower rate. And it’s estimated to inch down to 52 in the upcoming report, which means the manufacturing sector is expanding and a slightly slower pace;

Friday, September 2nd

13:30 – U.S. Non-Farm Payroll Update: In the recent employment report 255K jobs were added – above market expectations; the U.S. unemployment rate remained flat at 4.9%. The next report is expected to show a lower number (current estimates are at 186K); and wages to rise at a monthly rate of 0.2%; if the report beats estimates again, this could have a positive impact on the U.S. dollar and raise the chances of a rate hike in the coming months by the FOMC;

15:00 – U.S. Factory Orders: In the last report, factory orders decreased by 1.5% during July; currently, the market expectations are for a gain of 2.1% in August;

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