Financial Market Outlook for May 16-20

The volatility in the financial markets remains elevated over economical and geopolitical unrest including: Concerns over a possible Brexit, Greece’s debt problems, China’s economic slowdown, the U.S. presidential primaries and the Fed’s monetary policy, just to name a few. Besides the speculations over these issues, this week’s reports and events include: FOMC minutes of last meeting, U.S. CPI, Canada’s retail sales, U.S. existing home sales, Philly Fed index, ECB and RBA’s minutes, GB retail sales, Canada’s CPI, U.S. housing starts, GB’s employment report, and EU CPI.  

(All times GMT):

Monday, May 16th

00:30 – Minutes of Reserve Bank of Australia’s Monetary Policy Meeting: The Reserve Bank of Australia reduced its cash rate by 25 basis points to 1.75% as of the recent meeting; this report may move the Aussie dollar and perhaps indicate what’s next for RBA’s policy;

Tuesday, May 17th

09:30 – GB CPI: According to the previous update, the CPI rose to 0.5% in March. The current projections are for the inflation to remain flat in April at 0.5%;

13:30 – Canada Manufacturing Sales: In the last report regarding March 2016, manufacturing sales fell by 3.3%;

13:30 – U.S. Building Permits: The U.S Census Bureau will release for April 2016 the U.S. building permits monthly report; in the last update, total permits declined to 1,090 thousand houses (the recent U.S building permits update); current estimates are for a modest gain to 1,130 thousand houses;

13:30 – U.S. Housing Starts: In the last report, U.S. housing starts decreased to 1,090 thousand houses; in the next report, this figure is expected to edge up to 1,120 thousand houses;

13:30 – U.S Core Consumer Price Index: This monthly report refers to the changes in the core consumer price index for April 2016. According to the U.S Bureau of Labor statistics, back in March, the CPI ticked down by 0.1%; the core CPI – the same; this time, the CPI and core CPI are expected to rise by 0.4% and 0.2%, respectively;

14:15 – U.S. Industrial Production: This report will show the changes in the U.S industrial production during April; as of March, industrial production decreased by 0.6%;

Wednesday, May 18th

09:30 – Great Britain Average Earnings Index 3m/y: This report shows the developments in the price businesses and the government pays for labor force; in the recent report, this index rose to 1.8%; current market estimates are for the index to rise again by 1.7%;

09:30 – Great Britain Claimant Count Change: As of the recent monthly update, the number of unemployed in GB rose by 6.7K; the rate of unemployment didn’t move from 5.1% and is expected to maintain this level this time as well;

10:00 – EU CPI (final): Based on the last flash estimate, the CPI remained flat in April;

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 13th;

19:00 – Minutes of FOMC Meeting: This will be the main event of the week that could underwhelming and as such disappointing for the markets; this report could be the last chance the Fed will have to hint of any plans to change its monetary policy in the upcoming June meeting. The minutes will provide another take for the Fed’s monetary policy; they could also show how divided the FOMC is now given the current market conditions;

Thursday, May 19th

02:30 – Australia Employment Update: In the recent March report the rate of unemployment edged down to 5.7%; the number of employed (seasonally adjusted) rose by 26.1K people. The ongoing weakening of the Aussie dollar may start to help the country’s employment situation (see here the recent report);

09:30 – GB Retail Sales: In the upcoming report the market expects sales to have risen by 0.7% compared to the previous month;

12:30 – ECB Monetary Policy Meeting Accounts: Even though the minutes don’t tend to move markets, they could still surprise if they were to show some insights that weren’t expected to be seen;

13:30 – U.S. Jobless Claims Weekly Report:  This weekly report will refer to the changes in the initial jobless claims for the week ending on May 13th; in the last report, jobless claims rose to 294K; the expectations are for this number to come back down to 276K;

13:30 – Philly Fed Manufacturing Index: This monthly survey estimates the growth of the US manufacturing sectors. In the previous survey, the growth rate rose from 12.4 in March to -1.6 in April. This time, the index is expected to slightly rise to 3.2 (the recent Philly Fed review);

15:30 – EIA U.S. Natural Gas Storage: The EIA weekly report of the U.S. natural gas market will refer to the latest changes in natural gas production, storage, consumption and rates as of May 13th;

Friday, May 20th

13:30 – Canada’s core CPI: According to the latest report, the CPI rose by 0.7%, M-o-M; it’s expected to edged down to 0.2% in the next report;

13:30 – Canada Core Retail Sales: In the previous report regarding March, sales rose by 0.2%;

15:00 – U.S. Existing Home Sales: This report will refer to the U.S. existing home sales for April 2016; in the March report, the number of homes sold picked up to a seasonally adjusted annual rate of 5.33 million houses; the current expectations are for the annual rate to rise again to 5.39 million houses;

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