Jackson Hole and Inflation numbers!
Market analyst – IFC Markets
The week ahead will be an amazing and busy week with Jackson Hole Symposium on the last days of the week and US PCE data, while we should not forget about European economic data. On the other hand, Chinese regulatory still is the main concern in the week ahead for Asian Investors. Let’s take a quick look at the week ahead and the most important events.
PM data – Monday
Purchasing Manager Index on Monday will take the center of the stage! Manufacturing and Service PMI numbers from Australia, Japan, France, Germany, Eurozone, United Kingdom, and the United States will be the primary data on Monday. As these data are related to the summer, we expect an increase in Service PMI numbers and a general decrease in the manufacturing sector. This data is not likely to make any changes in the overall downtrend of EURUSD.
German & US Q2 GDP – Tuesday & Thursday
Gross domestic products, the leading economic index, will tell us more about how the world and Europe’s biggest economies have been behaving in the second quarter. At the same quarter in the year-ago, both economies had fallen sharply. Recovery in the US and Germany was primarily thanks to great stimulus packages. In the US, most of these helped will end on September 6, while Germans plan to have it by the end of next March. However, according to retail sale data published in the last months, we expect both to beat the preliminary numbers and even increase more. With US numbers, we are expecting a bit of support for the Dow Jones industrial index.
Jackson Hole Symposium, Thursday- Saturday
Unlike previous years, this year’s Symposium will be online, the same as a year ago. The online meeting will start on Thursday and end Saturday. Still, Friday’s FED chair speech will be where market participants and investors focus on learning more about the following FED movements. The answers for when and how to start the tapering will be the million-dollar question of the week. Any Hawkish signal from Chairman Speech means more fall in the stock markets, while Dovish tone, will help Wall Street to print new records high.
ECB Minutes – Thursday
July meeting was important because of first time announcing about new monetary policies of the European central bank. Thursday, the European central bank will publish its meeting minutes of July. These minutes are supposed to give us more information about the fate of stimulus after March 2022, when the current packages will end. Since we expect to learn more about dovish policies from Europe, German DAX is also likely to be supported by publishing the minutes.
US Personal Spending – Friday
Estimated for Personal Spending in July is to raise by 0.6%, while we are expecting a bit weaker in the Personal Income, especially with inflation in its 30-year high. We have higher prices which can calm the buyers; on the other hand, we had summer holiday that supposed to increase the sell. These two factors are expected to move against each other and cause persistent inflation. These concerns will add to the market worries about the following FED policies.
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