Original title: blockbuster data and events for the week from October 25 to 31: the three major central banks announced interest rate decisions, and the Federal Reserve entered a period of silence.
Source: Huitong Network
The market will welcome a series of blockbuster data and events in the week from October 25 to 31. In terms of events, pay attention to the interest rate decisions of the Bank of Canada, the Bank of Japan and the European Central Bank. Data, the third quarter of the United States GDP, the United States PCE, EIA, first request, personal expenditure, euro zone GDP, CPI and so on will be released one after another, investors need to pay close attention. It is worth noting that the Fed will enter a period of silence next week, as the Fed will hold its November interest rate meeting in the early hours of November 4.
Key words on Monday and Tuesday: German business boom, American consumer confidence
Data released last month by the Yves Institute for Economic Research, a German think-tank, showed that Germany's business climate index still fell month-on-month in September, falling slightly to 98.8 points from 99.6 points in August. This is the third consecutive month of month-on-month decline in the index.
Clemens Fester, director of the Ever Institute of Economics, pointed out that most of the enterprises surveyed in Germany not only had a more negative assessment of the current operating situation of the industry than in August, but also were skeptical about the development expectations in the coming months. In particular, the supply bottlenecks of raw materials and initial products put pressure on the German economy, which had a serious impact on the industrial sector.
Germany's IFO business climate index is now expected to be 98 in October, down slightly from 98.8 in September.
Us consumer confidence unexpectedly fell for the third month in a row in September, falling to its lowest level in seven months
COVID-19 variants of the virus Delta and inflation concerns affect the willingness of American households to spend.
The data showed that the Conference Board's consumer confidence index fell to 109.3 in September from a revised 115.2 in August, well below market expectations of 114.9.
Lynn Franco, director of the Conference Board, said the September data showed that consumers were more worried about the state of the economy and short-term growth prospects, while willingness to spend on housing, cars and major household appliances all fell again. Although concerns about short-term inflation have eased, inflation remains high.
Franco says consumers are becoming more cautious and are likely to spend less in the future.
Expectations for US inflation over the next five years rose to a 15-year high on Thursday as commodity prices rose in October, a trend that is expected to deal a further blow to consumer confidence, although it is worth noting that as Christmas approaches, consumers buy goods in advance, which could boost consumer confidence.
Keywords on Wednesday: us durable goods order, Bank of Canada decision, EIA
Despite a slowdown in output caused by power shortages, profit growth for China's industrial companies is likely to rise in September due to higher ex-factory prices and a low base in the same period last year.
Industrial profits are expected to rise 15.0 per cent in September from a year earlier, up from 10.1 per cent in August.
Higher product prices could boost corporate profits, with producer prices rising 10.7 per cent in September from a year earlier, up from 9.5 per cent in August.
Higher prices may offset the drag on corporate profits caused by the slowdown in the growth rate of industrial value added. Industrial production rose 3.1 per cent in September from a year earlier and 5.3 per cent in August.
According to the data, the initial value of durable goods orders in the United States in August was 1.8%, compared with the expected value of 0.7%, and the previous value was-0.1%. Durable goods orders improved for four consecutive months and returned to pre-epidemic levels.
In addition, the manufacturing PMI of Markit in September was 60.7, the lowest since April, which could cast a shadow over the data on durable goods orders in September. The market now expects the September quarter-on-month figure to be-1%.
At its September meeting, the Bank of Canada left its benchmark interest rate unchanged at 0.25 per cent and its asset purchase programme at C $2 billion a week, in line with market expectations.
The Bank of Canada said supply chain disruptions were curbing activity in some industries and that the increase in COVID-19 cases in many regions posed a risk to the strength of the global recovery and would continue to work to keep policy interest rates at an effective floor until economic weakness subsides, which is expected to subside in the second half of 2022, thereby sustainably meeting the 2 per cent inflation target.
Bank of Canada Governor John McClum said that when policy makers began to cut back on stimulus measures,
The first step will be to raise the central bank's policy interest rates rather than reduce bond holdings.
Analysts generally expect the central bank to raise interest rates at least once to 0.50% by the end of 2022, which is likely to happen in the second half of next year.
The latest data show that in the week ending October 15, EIA crude oil inventory changes in the United States actually announced a decrease of 431000 barrels, expected to increase by 2 million barrels, and the previous value increased by 6.088 million barrels; gasoline stocks actually announced a reduction of 5.368 million barrels, expected to decrease by 950000 barrels, and the previous value decreased by 1.958 million barrels; refined oil stocks were actually reported to be reduced by 39.13 million barrels, expected to decrease 1.15 million barrels, and the previous value decreased by 24,000 barrels.
John Kemp, an analyst, points out that commercial oil inventories in the developed economies of the United States and OECD as a whole have fallen below the average of the five years before COVID-19 's outbreak.
IEA noted that the energy crisis in Europe and Asia could increase global oil demand by a further 500000 b / d and raise global oil demand forecasts for 2021 and 2022.
Analysts say this could mean there is still room for oil prices to rise further this winter.
Keywords on Thursday: BoJ resolution, ECB resolution, US third quarter GDP, first request, third quarter core PCE
In its September resolution, the BoJ, as widely expected, kept short-term interest rates at minus 0.1 per cent and kept the 10-year bond yield target at near zero, but took a dimmer view of exports and factory output. the supply chain of some manufacturers was disrupted by factory shutdowns in Asia.
Toshihiko Kuroda, governor of the Bank of Japan, said he would not hesitate to expand easing measures if necessary.
Japanese consumer prices rose in September for the first time in 18 months as domestic energy and raw material costs rose. But the market still expects the BoJ to raise interest rates at the slowest pace among the world's major central banks.
The ECB is likely to pave the way for a major decision on asset purchases at its December meeting next week. Central bank governor Christine Lagarde should stick to her view that recent high inflation is unlikely to last. Open the door to increase the monthly bond purchase pace under the APP program after the PEPP asset purchase program expires in March next year.
It won't be long before price pressures from energy costs alone will be enough to push headline inflation above the ECB's 2% target.
The CMC may ignore the rise in inflation for the time being-the increase in underlying price pressure is still modest, and there is still a lot of room for growth in the job market.
The ECB is likely to continue to view the risks facing the economy as "generally balanced", although the downside risks are greater than the upside risks.
Wall Street is pessimistic about the U. S. economy in the third quarter.
Goldman Sachs Group in AugustAnnounced a reduction in the US GDP growth forecast for the third quarter from 8.5 per cent to 5.5 per cent.
Morgan StanleyIn the latest report, the US GDP forecast for the third quarter was cut sharply to 2.9 per cent from the previous forecast of 6.5 per cent.
Outbreaks, supply chain bottlenecks and high inflation continue to weigh on the US economy, while the momentum of economic growth brought about by the government's stimulus spending has been released ahead of schedule.
In terms of initial data, the data performed well this week and are expected to continue to improve next week, indicating that the labour market is gradually moving towards recovery, albeit at a slow pace.
Keywords on Friday: euro area GDP, CPI, US PCE, personal Expenditure, Canadian GDP
Driven by a strong rebound in consumer services across the eurozone, the eurozone economy is expected to continue to grow very strongly. However, we slightly lowered our third-quarter GDP growth forecast to 1.8% from the previous 2.0%, and expect economic growth to slow further in the fourth quarter.
The boost of vaccination across Europe made it possible for the service sector to reopen widely in the third quarter. Travel in France and Germany, as well as in the euro zone, has been subject to strict controls for much of the second quarter. We expect a strong rebound in the hotel and entertainment services sector, driving eurozone GDP growth of up to 1.5 per cent from the previous quarter.
Activity in other parts of the economy, by contrast, is quieter. After expansion in the second quarter, factory and construction sites were disrupted by supply chain problems, especially in Germany, where manufacturing and construction output were basically flat in the third quarter.
As supply chain problems persist into the end of this year and early next year, and the recovery in consumer services slows, we expect GDP growth to slow to 1.1 per cent in the fourth quarter.
However, the deployment of the EU recovery fund will help boost economic activity in the eurozone as a whole and should support relative growth in the coming quarters.
The eurozone economy will return to pre-pandemic levels by the end of the year.
Euro-zone inflation hit 3.4% in September (the last time it was in 2008), and inflation is expected to rise again this month. we
Headline inflation is expected to reach 3.7 per cent in October, while core inflation should hold steady at 1.9 per cent.
We expect headline inflation to peak at 4.1% in November.
Headline inflation in the eurozone has risen at a dizzying rate since the end of last year and has continued. Still, the rise in inflation is largely driven by higher energy costs. As electricity and natural gas prices soar in the region and road fuel costs rise again, we expect energy to boost inflation by 0.3 percentage points in October compared with September. For the same reason, it will rise by a further 0.3 percentage points in November.
As energy prices continue to rise and the statistical effects of tourism-related services increase, headline inflation is likely to jump to 4.1 per cent next month and core inflation to 2.1 per cent. Nevertheless, we expect this to be the peak hit by the data, and headline and core inflation should begin to decline gradually, as some one-off effects begin to fade. These one-off effects include temporary tax cuts from Germany, the recovery of road fuel costs after the outbreak, and the statistical impact of the weight used in the HICP basket.
More than half of euro zone inflation is driven by energy prices.
After two months of sudden cooling in the US non-farm data, supply chain problems remain and inflation concerns continue to rise, so there is reason to believe that the US PCE price index will continue to climb in September. The market is now expected to be 4.5 per cent, up from 4.3 per cent.
Personal spending data are expected to slow slightly, related to the continued decline in consumer confidence.
Canada's gross domestic product (GDP) fell 0.1 per cent in July, better than the previous estimate of 0.4 per cent. 13 of the 20 industrial sectors monitored by Statistics Canada showed growth, with hotels and restaurants growing the most, achieving double-digit growth for the second month in a row.
The Canadian economy contracted in the second quarter, and few expected such a retrogression at the beginning of the year. But the latest GDP data show that the Canadian economy will avoid a double-dip recession because there seems to be enough momentum to avoid a second consecutive quarter of contraction.
The Bureau of Statistics's preliminary estimate of GDP in August showed that the Canadian economy grew by 0.7 per cent. Given that the Canadian economy tends to grow at a monthly rate of about 0.2%, this would be a strong result.
Toronto-Dominion BankEconomist Tanabalasingam said: "further reopening across the country has contributed to a strong rebound in high-contact services. This strong momentum continues into August, which is a key reason for Statistics Canada's health estimates for August GDP. "