Major commodities including gold natural gas and silver trade up during the previous week along with the recovery of several currencies such as the Euro against the USD. Leading Equities markets changed direction and fell during last week. The recent publication of the minutes of the FOMC meeting and Bernanke’s testimony in Congress may have contributed to the fall of the markets. In the upcoming week several reports and decisions will come into play including: U.S consumer confidence, BOC rate decision, EU monetary development, U.S GDP for Q1 (second estimate), China manufacturing PMI, Japan’s Kuroda will talk, Canada’s GDP, U.S pending home sales, German retail sales, Australia Private New Capital Expenditure and U.S. jobless claims. Here is an economic outlook for the week of May 27th to May 31st regarding the U.S, China, Euro Area, Japan, Canada, and Australia.
(All times GMT):
Monday, May 27th
Tuesday, May 28th
15:00 – U.S Consumer Confidence: based on the latest monthly update, the consumer confidence index rose in March to 68.1 (M-o-M). The current expectations are that the March index may continue to rise; this report might affect commodities prices including the oil and natural gas;
01:00 – Bank of Japan’s Kuroda Speaks: Bank of Japan Governor will give a speech at the Bank’s Institute for Monetary and Economic Studies 2013 International Conference. The title of his speech is “The Financial Crisis and the International Financial System“;
Wednesday, May 29th
09:00 – Euro Area Monetary Development: This monthly report will refer to the shifts of the M3, M1 and loans to private sector in the Euro area for April 2013. In the recent March report, the annual growth rate for M3 declined to 2.6%; M1 edged up to 7.1%. Finally, the annual growth rate of loans to private sector reached -0.8%. This news suggests the EU economy continues to slowdown. Perhaps the latest decision of the ECB to cut the cash rate by 0.25 may help pull up the M1, M3 and private loans in the coming months. Nonetheless, if this trend will persist it may adversely affect the Euro/USD and consequently commodities;
15:00 – Bank of Canada’s Overnight Rate: The Bank of Canada will make its decision regarding the Canadian overnight rate, which remained unchanged at 1%. The BOC may keep its policy and maintain its interest rate at 1%; the recent slowdown in Canada’s economy and the decision of other leading central banks such as ECB and RBA to cut their respective cash rates might also prompt BOC to reduce its cash rate;
Tentative – Spanish 10 Year Bond Auction: Spain will issue its monthly bond auction; in the latest bond auction, which was held at the middle of April, the average rate reached 4.61% – a higher rate than in the previous bond auction;
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 24th; in the previous update for May 17th, stockpiles rose by 4.2 ml bl and reached 1,802.5 ml bl.
02:30 – Australia’s Building Approvals: In the previous report regarding March the buildings approvals declined by 5.5% compared to February. This report is another indication for the developments in the Australian housing market;
02:30 – Australia Private New Capital Expenditure: This quarterly report shows the developments in the private new capital expenditures and expected expenditures for the first quarter of 2013. As of the latest quarter, the seasonal adjusted total of new capital expenditure decreased by 1.2% (Q-o-Q) but rose by 10% compared to the previous quarter in 2011. If this upward trend will persist, it may positively affect the Aussie dollar, which tends to be strongly linked with major commodities;
Thursday, May 30th
Tentative – Italian 10 Year Bond Auction: the Italian government will come up with another bond auction; in the latest bond auction, which was held at the end of April, the average rate fell to 3.94%;
13:30 – Second Estimate of U.S GDP 1Q 2013: This will be the second estimate of U.S’s first quarter 2013 real GDP growth. In the recent estimate the U.S GDP rose by 2.5% in the first quarter – slightly lower than the rate many had expected; in the fourth quarter the GDP grew by 0.4% (annual terms);. If the growth rate in the first quarter of 2013 will rise above 2.5%, this could positively affect not only the US dollar but also commodities prices.
13:30 – U.S. Jobless Claims Weekly Report: this weekly report will refer to the shifts in the initial jobless claims for the week ending on May 25th; in the latest report the jobless claims rose by 23k to reach 340k; this upcoming weekly report may affect the U.S dollar and consequently commodities and stocks markets;
15:00 – U.S. Pending Home Sales: This report shows the changes in pending home sales in the U.S. for April; in the recent report, the pending home sales index rose by 1.5% (M-over-M). These data are another indicator for the developments in America’s housing market; if the housing data will show a rise in sales it may pull up the U.S dollar;
15:30 – EIA U.S. Natural Gas Storage Update: the EIA weekly update of the U.S. natural gas market will refer to the latest developments in natural gas production, storage, consumption and rates as of May 25th; in recent weekly report, natural gas storage rose by 89 Bcf to 2,053 Bcf;
Friday, May 31st
08:00 – KOF Economic Barometer: this monthly update provides an estimate to the Swiss economy in the months to come;
08:00 – German Retail Sales: This monthly update will show the shifts in German retail sales during April. In March 2013, retail sales slipped by 0.3% – lower than many had anticipated; if this report will show a drop again in sales then it might weakened the Euro;
13:30 – U.S Personal spending: this monthly update will refer to the shifts in income and outlays in the U.S during April; in the last report regarding March the personal income rose by 0.2%;
13:30 – Canada’s GDP by Industry: this monthly report shows the changes in major industrial sectors for March 2013. In the recent update regarding February 2013, the real gross domestic product slightly increased by 0.3%. This report may affect the Canadian dollar, which is strongly linked with major commodities prices;
14:55 – UoM Consumer Sentiment (revised): University of Michigan will come out with its revised consumer sentiment monthly report; this survey could offer an insight to recent developments in U.S consumers’ sentiment; based on the latest report, the sentiment index fell to 76.4;
02:00 – China Manufacturing PMI: Based on the latest report regarding April 2013 the Manufacturing PMI edged down to 50.6 – i.e. China’s manufacturing sectors is expanding at a slower rate; the recent flash PMI report fell below the 50 point market. If in the upcoming report the PMI will drop below the 50 point mark, it could signal slowdown in China’s economy. If the index will fall, this may also adversely affect commodities prices.
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