November 24, 2022
  • November 24, 2022

Week Ahead – Moment of Truth

By on November 12, 2022 0

WE

After a series of soft inflation data sparked a relief rally to buy everything, Wall Street will focus on the Fed speech and a plethora of data points that could show the economy remains resilient. Key economic readings include manufacturing activity, retail sales and housing data.

There will be no shortage of Fed appearances this week. Brainard and Williams speak on Monday, while Tuesday includes speeches from Harker, Cook and Barr. Wednesday will bring Williams, Barr and Waller, and Thursday we will hear from Bullard, Bowman, Mester, Jefferson and Kashkari.

Along with a slew of economic releases, traders will also be keeping a close eye on big retail earnings from Walmart, Target, Macy’s and Kohl’s. We should know more about consumer health and whether we should expect further price easing as the holiday season approaches.

EU

It’s been a relatively calm week for the EU, with the two notable economic releases being the flash GDP and the final HICP. With the economy facing a recession, the GDP data will provide an interesting insight into how quickly growth is slowing ahead of an uncertain winter. Inflation data will naturally be interesting, but it may take a major overhaul to really grab the attention of investors.

UK

The fall statement has been a long time coming, it seems. The markets have calmed down a lot since the ridiculous mini-budget but it will still take time for the government to regain credibility and the confidence of the markets. It starts next week and all eyes will be on Parliament as we hear how the new government plans to balance the books without adding further misery to the economy.

The hearing of the BoE’s monetary policy report next week is another highlight, but plenty of economic data is also expected. The path for interest rates remains uncertain, so it’s not just what policymakers have to say that matters, it’s whether the data allows them to slow the pace of tightening going forward as they wish if clearly. Thursday’s CPI is the obvious highlight, but there are plenty more throughout the week.

Russia

A quiet week with no notable economic data.

South Africa

Another calm week with the only economic release being retail sales on Wednesday.

Turkey

No major economic releases next week as investors are still focused on the central bank and inflation.

Swiss

Level three data dominate next week. The focus remains on what the SNB will do in December, with President Jordan acknowledging on Friday that monetary policy is not tight enough to bring inflation back into the price stability range over the medium term. The risk of a rate hike before the meeting remains.

China

Weeks of speculation around China’s commitment to its zero Covid policy has spurred a rally in local stocks and we may be on the verge of getting more information on what that will entail. A relaxation of quarantine measures has been announced in recent days and a press briefing is now scheduled for Saturday. At the same time, China is seeing a steady rise in Covid cases, leading to more restrictions and mass testing.

October data on China’s retail sales, industrial production and investment will be released next week. The PBOC is also expected to keep the rate on its one-year medium-term lending facility at 2.75% in November.

India

A key inflation report could show that price pressures are easing, which could allow the RBI to be less aggressive in its tightening path. Headline inflation is expected to decline from 7.4% to 6.7%.

Australia and New Zealand

The focus for Australia and New Zealand may remain on China and their weakening outlook due to their struggles with COVID.

Australian jobs data is expected to show job growth continuing, while unemployment remains at 3.5%. Wage pressures in the third quarter are expected to increase, but some of that is attributed to the increase in the minimum wage.

In New Zealand, data on house sales and producer prices will be released.

Japan

Japan’s third-quarter GDP reading is expected to show significant weakness as import costs soar. Core inflation in Japan is also expected to jump from 3.0% to 3.5%, which should clearly weigh on consumer spending. Given the weakness of the US dollar, the BOJ could save its ammunition and no longer intervene in the foreign exchange market.

Singapore

The week is expected to be quiet, with the exception of non-oil domestic export data.

Economic Calendar

Sunday November 13

Economic data/events

  • Medium-term loans in China
  • ASEAN summit ends in Cambodia.

Monday November 14

Economic data/events

  • Euro area industrial production
  • India trade, CPI, wholesale price
  • New Zealand Performance Services Index
  • The Fed’s Williams hosts a panel at the Economic Club of New York
  • ECB’s Fabio Panetta speaks in Florence
  • ECB’s De Guindos speaks in Frankfurt.
  • BOJ announces amount of outright purchase of Japanese government securities

Tuesday, November 15

Economic data/events

  • American Empire Manufacturing, PPI
  • CPI France
  • CPI Poland
  • Eurozone GDP
  • GDP of Hungary
  • Sales of existing homes in Canada
  • China retail sales, industrial production, jobless survey
  • Unemployment France
  • Expectations from the ZEW survey in Germany
  • Japan Industrial Production, GDP
  • Mexico’s international reserves
  • New Zealand housing sales, net migration
  • South Korea export/import price index, money supply
  • Claims for unemployment insurance in the UK, unemployment
  • G-20 Summit in Bali
  • IEA Monthly Oil Market Report
  • ECB’s Elderson speaks
  • Fed’s Harker speaks at the GIC’s annual monetary and trade conference
  • Former US President Trump is due to make an announcement in Florida
  • RBA releases minutes of November interest rate meeting

Wednesday, November 16

Economic data/events

  • US business stocks, cross-border investment, retail sales, industrial production
  • Australia Leading Index
  • CPI Canada, housing starts
  • Real estate prices in China
  • GDP of Israel
  • CPI Italy
  • Machinery orders in Japan, tertiary index, department store sales
  • Bloomberg Economic Survey of the Philippines
  • GDP of Russia
  • Retail sales in South Africa
  • UK CPI
  • EIA Crude Oil Inventory Report
  • G-20 Summit in Bali
  • BOE Gov Bailey appears before Treasury Committee
  • Fed’s Williams and Brainard, SEC’s Gensler speak at 2022 Treasury Market Conference
  • ECB Financial Stability Review
  • ECB President Lagarde speaks
  • ECB’s Fabio Panetta speaks

Thursday, November 17

Economic data/events

  • US housing starts, first jobless claims
  • Trade Italy
  • Singapore Trade
  • Unemployment in Australia
  • China Swift Payments
  • Eurozone CPI, new car registrations
  • Hong Kong unemployment rate
  • Japan’s exports, trade balance
  • New Zealand IPP
  • Singapore non-oil exports
  • UK budget statement, economic forecast
  • Fed’s Kashkari and Jefferson speak at the Federal Reserve Bank of Minneapolis Fall Institute Research Conference
  • Fed Mester speaks at the Federal Reserve Bank of Cleveland and the Office of Financial Research’s Annual Financial Stability Conference
  • Fed’s Evans speaks ahead of his retirement
  • BOE’s Silvana Tenreyro speaks
  • SNB’s Maechler speaks at the Money Market Event in Geneva
  • BOE’s Huw Pill speaks at the Bristol Festival of Economics on “What Next for Central Banks”

Friday November 18

Economic data/events

  • U.S. Conference Board Leading Index, Existing Home Sales
  • GDP of Norway
  • CPI Japan
  • Thailand’s foreign exchange reserves, futures, car sales
  • ECB President Lagarde, Nagel and Knot speak alongside BOE Mann Fed Collins at the Federal Reserve Bank of Boston Economic Conference
  • BOE’s Jonathan Haskel speaks

Sovereign Ratings Updates

  • Italy (Fitch)
  • Sweden (Fitch)
  • Turkey (Fitch)
  • Ireland (S&P)
  • South Africa (S&P)
  • Portugal (Moody’s)
  • South Africa (Moody’s)
  • Denmark (DBRS)