Weekly Outlook of Financial Markets for August 5-9

Last week the Aussie dollar tumbled down while the Euro remained nearly unchanged against the USD. In the commodities market, silver and crude oil rallied while gold and natural gas declined. In the upcoming week several reports, decisions and events will unfold and may affect commodities, equities and forex markets; these include: U.S non- manufacturing PMI, China’s CPI, Japan’s current account, BOJ monetary policy meeting, Australia’s trade balance, U.S and Canada’s trade balance reports, German Industrial production, Bank of England Carney Speaks, and U.S. jobless claims. Here is an economic outlook for the week of August 5th to August 9th regarding the U.S, Japan, China, Euro Area, Australia, Canada, and Great Britain.   

(All times GMT):

Monday, August 5th

00:30 – Australian Retail Sales: This monthly report will pertain to June 2013. In the previous update, the seasonally adjusted retail sales slightly rose by 0.1% during May; this news may affect the Aussie dollar, which tends to be correlated with commodities rates;

09:30 – GB Services PMI: In the previous report, this index rose to 56.9%; this index may affect the British Pound;

15:00 – U.S. ISM Non-Manufacturing PMI: This monthly update will refer to the developments in the non-manufacturing sector for July 2013. In the previous update, this index slipped to 52.2% – thus, the non-manufacturing is still expanding but at a slower rate than in the previous month; this index may affect the US dollar;

Tuesday, August 6th

02:30 – Australian Trade Balance: Thus upcoming report will pertain to June’s figures. In the last update, regarding May, the seasonally adjusted balance of goods and services rose to a $670 million surplus. The export of non-monetary gold increased by $135 million; if the gold exports will continue to increase in June, it might suggest a rise in demand for non-monetary gold (see here latest update);

05:30 – Reserve Bank of Australia – Cash Rate Statement: In the latest rate decision of RBA it left the cash rate at 2.75% – its lowest level in years, which contributed to decline of the Aussie dollar. The current expectations are that RBA will cut the interest rate again by 0.25 percentage points, which is likely to keep the Aussie weak against leading currencies. In such an event the Australian dollar, which tends to be strongly correlated with oil and gold prices, may drag down commodities rates;

09:30 – Great Britain Manufacturing Production: This update will present the annual rate of GB’s manufacturing production as of June; in the previous report regarding May 2013 the index fell by 0.8% (M-2-M); this news may affect the British Pound;

13:30 –American Trade Balance: This monthly update for June will show the changes in imports and exports of goods and services to and from the U.S, such as commodities such as oil and gas; based on the recent American trade balance update regarding May the goods and services deficit expanded to $45 billion;

13:30 – Canadian Trade Balance: In the previous report regarding May 2013, exports slipped to 1.6% and imports decreased by 3.2%; as a result, the trade balance’s deficit fell from $951 million in April to $303 million in May; this report may affect the Canadian dollar which tends to be correlated with commodities;

Wednesday, August 7th

10:30 –BOE Inflation Report: Bank of England will publish this quarterly report that includes the bank’s inflation projection for 2013 and 2014;

10:30 –BOE Governor Carney Speaks: Governor Carney will hold a press conference regarding the Inflation Report and the Bank’s projections for the economic growth in the coming years;

11:00 – German Industrial Production: The upcoming report will refer to July 2013. In the last update, the industrial production fell by 1% during June;

15:00 – Canada’s Ivey PMI: This report shows the diffusion index based on surveyed purchasing managers; in last month’s update, the index plummeted to 55.3. The report might affect the Canadian dollar;

Tentative – U.S 10 Year Bond Auction: the U.S government will come out with its monthly bond auction; in the last auction, which was held at the second week of July, the average rate reached 2.67% – the highest rate in recent months;

15:30 – U.S Crude Oil Stockpiles Weekly Update: the EIA (Energy Information Administration) will come out with its weekly report on the U.S oil and petroleum stockpiles for the week ending on August 2nd;

Tentative – Japan’s monetary policy meeting and press conference:Japan’s monetary policy meeting will be held on that day. BOJ members will decide on any shifts to the bank’s current asset purchase program. These decisions could affect the direction of the Japanese yen;

Thursday, August 8th

Tentative – China’s Trade Balance: According to the recent monthly report, China’s trade balance increased again to a $27.1 billion surplus; if the surplus will further rise, it could indicate that China’s economic growth is improving and thus may positively affect commodities;

00:50 – Japan Current Account: this monthly report will show the developments in the difference between exports and imports for Japan during the previous month; this news may affect the direction of the Japanese Yen;

02:30 – Australia Employment Report: in the last report regarding June 2013 the rate of unemployment rose to 5.7%; the number of employed (seasonally adjusted) slightly rose by 10,300 people. This report could affect the Aussie dollar (see here the recent report);

09:00 – ECB Monthly Bulletin: This monthly report for July analyzes the economic developments of the Euro Area such as the price stability, interest rate decisions and governments’ debt; this update may provide some perspective on the forecasts of the EU progress;

13:30 – U.S. Jobless Claims Weekly Report:  this weekly update will refer to the developments in the initial jobless claims for the week ending on August 2nd; in the latest report the jobless claims fell by 19k to reach 326k; this upcoming weekly report may affect the U.S dollar and consequently commodities and stocks markets;

15:30 – EIA U.S. Natural Gas Storage Update: the EIA weekly report regarding U.S. natural gas market will pertain to the latest developments in natural gas production, storage, consumption and rates as of August 2nd; in latest weekly update, natural gas storage rose by 59 Bcf to 2,845 Bcf;

Tentative – China’s CPI: during May, the Chinese inflation rate rose to an annual rate of 2.7%, which is still lower than China’s target inflation. The low inflation is another indication for China’s economic slowdown. If the inflation will continue to pick up, however, this may indicate China’s economic progress is warming up;

Friday, August 9th

Tentative – China New Loans: This report will pertain to the recent developments in China’s new loans. Based on the recent report, the total loans sharply increased rose again; this report is another indicator for China’s economic growth;

01:30 – Reserve Bank of Australia – Monetary Policy Statement: The RBA will publish its quarterly report regarding the Bank’s monetary policy;

06:30 –China’s Industrial Production: According to last month’s report, China production growth rate slipped to 8.9% in annual terms; if the growth rate will further fall it suggest China’s economy isn’t progressing as fast as it did;

08:45 – French Industrial Production: This upcoming report will pertain to July’s figures. In the latest update, the industrial production slipped by 0.4% during June;

Tentative – OPEC Monthly Report: this monthly update will show the developments in crude oil and natural gas’s supply and demand worldwide during July 2013; this update will also refer to the changes in the production of OPEC countries during last month; this news may affect oil prices;

Tentative –IEA Monthly Oil Report: the upcoming monthly report will show a revised (as of May) forecast and analysis for the global crude oil and natural gas market for 2013 and 2014;

13:30 – Canada’s Employment Report: In the latest employment update for June 2013, unemployment remained unchanged at 7.1%; the employment slipped by 0.4k during the month. The upcoming report might affect the Canadian dollar and consequently commodities;

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