Events to Look Out for Next Week

Andria Pichidi

September 24, 2021

The overall cautious mood is expected to continue next week as markets continue to eye problems at Evergrande, the troubled mega property developer in China, and the potential wider fallout. The beleaguered developer hasn’t made a coupon payment on USD bonds and while it has 30 days before a default is declared, ECB head Lagarde has already been quizzed on the possible exposure for the Eurozone. The economic agenda ahead is expected to be a massive one, as it’s packed with central banks’ official speeches with attention focused on the ECB Forum on Central Banking on Wednesday. Data however will also dominate volatility as the week includes leading indicators such as GDP, Retail Sales, PMI and GDP from the largest economies in the world.

Have a look at the most important events of the coming days in our usual weekly publication.

Monday – 27 September 2021

German Federal Elections – On September 27, the Center on the United States and Europe at Brookings will host a panel discussion on the results of the 2021 German federal election. Ahead of Sunday’s German federal election the opinion polls suggest that Olaf Scholz, leader of the centre-left SPD and current finance minister, will succeed Angela Merkel as chancellor.
Durable Goods (USD, GMT 12:30) – Durable goods orders are expected to rise 0.5% in August with a 0.5% gain for transportation orders. Durable orders ex-transportation is pegged to rise 0.5%, after a 0.8% July increase. Defense orders are pegged at -12.1%, following a 21.6% July pop. Boeing orders rose to 53 planes, after dipping to 31 in July from a 3-year high of 219 in June.
BoE Governor Bailey Speech (GBP, GMT 18:00)
BoJ Monetary Policy Meeting Minutes (JPY, GMT 23:50) – The BoJ minutes should provide further guidance for 2021.

Tuesday – 28 September 2021

Retail Sales (AUD, GMT 00:30) – The preliminary Retail sales are seen diving at -2.4% m/m in August from -2.7% last month.
Consumer Confidence (USD, GMT 14:00) – The US Consumer Confidence is expected to bounce to 115.0 after a drop to 113.8 in August. Confidence faces a mounting headwind from the delta variant and resumed mask requirements, while the prior confidence updraft with stimulus and vaccines has dissipated since April, and nearly all the major confidence measures have fallen since June.

Wednesday – 29 September 2021

ECB Forum on Central Banking – Virtual Panel Discussion (N/A, GMT 15:45) –BoE Governor Bailey, ECB President Lagarde, BoJ Governor Kuroda and Fed Chair Powell Speeches.

Thursday – 30 September 2021

Manufacturing PMI (CNY, GMT 01:00) – The NBS Manufacturing PMI is expected to remain above 50 but to steady to 50.2 in September from 50.1.
Gross Domestic Product (GBP, GMT 06:00) – GDP is the economy’s most important figure. Q2’s GDP is expected to contract at -1.5% q/q and -6.1% y/y from 22.2% y/y.
Unemployment data (EUR, GMT 07:55) – The German unemployment rate in September is expected slightly higher, while unemployment change is expected to present -40K of people out of work, 13K less than the August reading.
Gross Domestic Product (USD, GMT 12:30) – A slight boost is seen in Q2 GDP growth to 7.0% from 6.6%. The Q2 GDP growth pace is a good gauge of the “speed limit” for the economy, given widespread supply constraints. The Q2 GDP figures document a continued consumption boom from two rounds of fiscal stimulus during Q1 and vaccine distributions, a diminished updraft for business fixed investment, and a pull-back in residential investment following an enormous boom to a Q1 peak. Exports and imports continued to climb sharply, while net exports continued to subtract from GDP. Inventories liquidated further through Q2, and were in net liquidation through four of the six quarters through Q2, as capacity constraints have limited the ability of producers to meet demand.

Friday – 01 October 2021

China Holiday – National Day
Manufacturing PMI (EUR, GMT 07:55) – The final German Manufacturing PMI for September should stay at the very high 62.7. A strong start to the third quarter, even if capacity constraints and supply chain disruptions limit output in some countries and sectors. Orders growth has remained strong, which means even if these factors weigh on the short term outlook, they will sustain industry through to the last quarter of the year. More signs then that the delta variant may be slowing the recovery somewhat, but won’t derail it.
Manufacturing PMI (GBP, GMT 08:30) – The UK Manufacturing PMI for August was seen revised up to 60.3 from 60.1
Gross Domestic Product (CAD, GMT 12:30) – The Canada GDP measure fell -1.1% in Q2 (q/q, saar) missing expectations, after a 5.5% (was 5.6%) growth pace in Q1.
ISM Manufacturing PMI (USD, GMT 14:00) – The ISM index is expected to fall to 59.5 from 59.9 in August, compared to an 18-year high of 64.7 in March, an 11-year low of 41.5 in April of 2020, and an all-time low of 30.3 in June of 1980.

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Andria Pichidi

Market Analyst

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