Events to Look Out for Next Week

Andria Pichidi

October 14, 2022

The UK turmoil is expected to remain in the spotlight next week after a “roller coaster” week for the UK bond markets with PM Truss sacking the Chancellor, appointing Jeremy Hunt as the new Chancellor and scrapping her signature corporation tax cut from the government’s mini-budget. Yet the inflation data next week from the UK, Canada and New Zealand could clarify whether inflation has peaked or not as the window of opportunity for central banks to hike rates is closing, and financial stability risks are also picking up.

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

Trade Balance (CNY, GMT N/A) – The trade surplus for China is expected to widen in February to $81bln from $79.39bln in August.
BOC Business Outlook Survey (CAD, GMT 14:30)
Consumer Price Index (NZD, GMT 21:45) – Q3’s New Zealand CPI is expected to fall slightly from the last release, to 1.5% q/q from 1.7% q/q.

Tuesday – 18 October 2022

RBA Minutes (AUD, GMT 00:30) – The RBA minutes should provide guidance on the pace for further aggressive rate hikes to quell still very elevated inflation rates.
Gross Domestic Product (CNY, GMT 02:00) – GDP is the economy’s most important figure. Q3’s GDP headline is expected to grow at 3.5% y/y from 0.4% y/y.
Economic Sentiment (EUR, GMT 10:00) – October’s German ZEW economic sentiment is seen to have declined at -66 from -61.9. The negative readings indicate that pessimism over the outlook is dominating with far fewer respondents taking a positive view on the current situation or the outlook. Cost pressures and the energy crisis in Europe have much to do with the deterioration in investor confidence. However, concern that aggressive central bank action will curb demand will also play a role. It seems unlikely that Germany and indeed the Eurozone as a whole can escape a recession.

Wednesday – 19 October 2022

Consumer Price Index (GBP, GMT 06:00) – UK inflation looks more long lasting, following a BOE survey indicating that inflation expectations at UK firms are rising. In September though inflation is seen lower with overall inflation expected to stand at 2.9% y/y from 3.2% y/y.
Consumer Price Index and Core (EUR, GMT 09:00) – Eurozone HICP inflation is expected to remain unchanged at 10.0% y/y for September, up from 9.1% y/y in the previous month. Energy and food prices remain the main driving factors.
Consumer Price Index and Core (CAD, GMT 12:30) – Canada CPI (NSA) declined -0.3% in August. It was the largest monthly drop since April 2020. Most of the weakness was in gasoline which plunged another -9.6% after dropping -9.2% in July. The core measures slowed too, with the median gauge slipping to 4.8% from 4.9% (was 5.0%). For September the reading is seen at -0.1% m/m.

Thursday – 20 October 2022

Labour Market Data (AUD, GMT 00:30) – Employment change for September is expected to grow by 25K from 33.5K, with the unemployment rate at 3.5% m/m.
Philly Fed Index (USD, GMT 12:30) – The Philly Fed manufacturing index is expected to rise to -6.0 from -9.9, after bouncing to 6.2 in August, versus a 48-year high of 50.2 in April of 2021. The various producer sentiment measures have moderated through 2022 from remarkably lofty peaks for most measures last November, with readings for some measures in contraction territory, though with most of the component indexes still at positive levels. Producers are facing big headwinds from soaring interest rates and moderating economic growth, but have benefited from the need to rebuild inventories into 2023 following a prolonged period of supply chain disruptions.

Friday – 21 October 2022

Retail Sales (GBP, GMT 06:00) – UK Retail Sales are expected to ease a bit, with -0.5% m/m and -4.2% y/y. Core Retail sales for September are expected to fall to -0.7 m/m and -3.4% y/y.
Retail Sales (CAD, GMT 12:30) – Canada August Retail Sales could fall to -2.0% m/m and core at -1.2% m/m.

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Andria Pichidi

Market Analyst

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