Shaping the markets – this week
Will the feelgood factor continue? Industrial production and inflation data in focus
The week has started off with the feelgood factor spreading through Asian markets. In Japan, the final estimate of second quarter gross domestic product growth came in at an annualised rate of 3.8%, trumping the preliminary reading of 2.6%. This comes hot on the heels of the announcement that Tokyo has won the bid to host the 2020 Summer Olympics. News that Chinese trade had rebounded also provided another boon; shipments increased 7.2% in August from a year earlier. Looking ahead, Chinese industrial production, retail sales and money supply data will be published on Tuesday. Analysts expect August industrial production to have grown by 9.9% year-on-year, a slight improvement from July’s housing-driven increase of 9.7%.
Among the key US data releases are retail sales and consumer confidence data from the University of Michigan on Friday. Consensus data show August retail sales are expected to rise 0.4% month-on-month (mom); higher sales of autos and building materials could result in a third consecutive month of rises. On Thursday, the latest federal budget is announced, along with weekly initial jobless claims. The main economic release for the UK is the July unemployment report. The market will be keen to see if the unemployment rate stays at 7.8% or creeps further above the Bank of England’s 7.0% threshold outlined by governor Mark Carney in his forward guidance announcement. July’s industrial production figures are due out for France, Italy and the broader eurozone. Consumer prices data are also published for Germany, France, Italy and Spain.
