Diary: Fedspeak, Retail Sales, Payroll Data

By Glenn Dyer | More Articles by Glenn Dyer

More updates on economies local and global this week, more COVID-19 lockdowns after more cases, especially across Europe and wobbly markets.

In fact, stock markets will remain under pressure, the US especially where the November 3 election campaign is in full confusion and fury and the weakening demand for tech shares is starting to hit home as Apple shares tank (See separate story).

As well the week will also focus on business conditions activity surveys for September to be released Wednesday.

These are expected to remain strong in the US and improve in Japan and Australia as the number of new coronavirus cases has fallen in both countries but are vulnerable to a further decline in Europe where new cases are continuing to rise

The US also sees a big rush of speeches by Fed members this week.

In Australia, there’s the preliminary retail sales for August (Wednesday), payroll and jobs data till September 5 tomorrow, and population data for the March quarter on Thursday.

The impact of the lockdowns in Melbourne and Victoria will be seen in the retail sales and the payroll and wages data.

The AMP’s chief economist Shane Oliver sees retail sales falling 3% because of the weakness in Victoria. They rose 3.2% in July

He wrote at the weekend that the payroll jobs data for the period to September 5 will also be weaker because of Victoria. Dr. Oliver said the March population data will show some slowing in population growth due to lower immigration in March.

RBA Deputy Governor Guy Debelle speaks tomorrow and his speech will also be watched closely for any clues regarding future monetary easing.

There will be a smattering of financial results this week from linked companies, Brickworks, New Hope, and Washington H Soul Pattinson.

In New Zealand, the Reserve Bank is expected to again sit on rates but make it clear it is moving towards negative rates from the start of 2021 at its November meeting.

Some economists though say a negative rates structure will be outlined at this week’s meeting following recent monetary measures that included an expansion of the asset purchase program in size and time.

Australia’s big four banks have been told to make sure they are able to accommodate a negative rates structure by the RBNZ.

In the US Fed Chairman Jerome Powell and Treasury Secretary Steven Mnuchin appear before Congress to report on coronavirus aid.

Chairman Jerome Powell appears before three Congressional committees. At two of those, Tuesday and Thursday, Powell appears with Treasury Secretary Steven Mnuchin to discuss coronavirus aid.

There are 10 other speeches or comments due to come from senior members of the Fed – all of which will be examined for comments on the central bank’s new rate policy of no movement to the end of 2023 at the earliest, and the more relaxed approach to inflation and unemployment.

Besides the early business activity survey for September midweek, the US will also see data on existing home sales (tomorrow) and new home sales (Thursday), a further rise in home prices (Wednesday) and durable goods orders (Friday).

There’s also a scattering of earnings reports due in the US: reports are expected from Jefferies Financial Group, which Reuters says is typically seen as a preview of what’s to come from Wall Street banks; sportswear and sneaker group, Nike; cruise line Carnival (owners of the Ruby Princess) and retailers including Rite Aid and Costco.

Besides the NZ rate decision on Wednesday, China’s monthly prime loan rate decision will be out later today with the Bank of Thailand releasing its decision on decision on Wednesday as well.

The Bank of Japan releases minutes of its meeting earlier in the month on Wednesday. The meeting was held before the election of a new Prime Minister.

The European Central Bank has a non-policy meeting this week and a meeting of its governing council.

Glenn Dyer

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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