In the upcoming week, the monetary policy meeting minutes from the U.S., Australia, and the Euro Area will be on focus. The economic data releases scheduled for the week include the manufacturing and services PMIs from France, Germany, the U.S., and the U.K. These data are expected to provide insights into the impact of China’s coronavirus outbreak on the economic growth of countries around the world. Other important releases include inflation, jobs report, and retail trade data from the U.K., Australia, and Canada.
#1: Australia Monetary Policy Meeting Minutes (02/18/2020 Tuesday 00:30 GMT)
The Reserve Bank of Australia releases the minutes of the monetary policy meeting eleven times in a year, two weeks after the announcement of the Cash Rate. It provides a detailed account of the most recent meeting of the Reserve Bank Board. It also provides in-depth insights as regards the economic conditions that impacted their decision on setting interest rates.
#2: Germany ZEW Economic Sentiment (02/18/2020 Tuesday 10:00 GMT)
In Germany, the ZEW Indicator, which indicates Economic Sentiment, rose by 16.0 points to the 26.7 level in January from the prior month. This is the highest level for the index ever since July 2015. The reading for January also came in well above analysts’ expectations of 15.0. According to investors, the negative effects of the trade dispute on Germany’s economy are likely to less pronounced than what was previously thought because of the signing of the Phase One agreement between the US and China. Additionally, the German economy has recovered a little more than expected in the prior year. The assessment of the country’s economic situation has also improved considerably. The corresponding indicator has jumped by 10.4 points to the -9.5 level.
Forecast for February 2020: 20.0
#3: Australia Wage Price Index (02/19/2020 Wednesday 00:30 GMT)
In Australia, the seasonally adjusted Wage Price Index rose by 0.5 percent in the September quarter of 2019 from the previous quarter. Both the public and private sectors also recorded a wage-price index growth of 0.5 percent. The highest increase in the index was registered in food services and accommodation and the lowest quarterly increase was reported by the finance and insurance services sector.
Forecast for December quarter of 2019: 0.5 percent
#4: United Kingdom CPI (02/19/2020 Wednesday 09:30 GMT)
In the United Kingdom, the consumer price inflation slowed down to the 1.3 percent level on a year-on-year basis in December last year, the lowest reading ever since November 2016. The reading for the month also came in below analysts’ expectations of 1.5 percent. Prices increased at a slower pace for restaurants and hotels; transport; and food and non-alcoholic beverages. In addition, prices of clothing and footwear declined after remaining unchanged in November. The core inflation rate, which does not consider the prices of alcoholic beverages, tobacco, energy, and food, came in at 1.4 percent, the lowest level in as many as three years. Analysts had expected the core inflation to come in at 1.7 percent.
Forecast for January 2020: 1.7 percent
#5: Canada CPI (02/19/2020 Wednesday 13:30 GMT)
In Canada, the Consumer Price Index declined by 0.0 percent in December last year from the prior month.
Forecast for January 2020: 0.3 percent
#6: United States FOMC Meeting Minutes (02/19/2020 Wednesday 19:00 GMT)
The U.S. Federal Reserve releases the minutes of the FOMC meeting eight times in a year, three weeks after the announcement of the Federal Funds Rate. It provides a detailed account of the most recent meeting of the FOMC and offers in-depth insights into the financial and economic conditions that impacted their decision as regards setting interest rates.
#7: Australia Employment Change (02/20/2020 Thursday 00:30 GMT)
Australia hired 28,900 workers in December last year after the reading for the prior month was revised downward to an addition of 38,500 jobs. The reading for December beat analysts’ expectations for an addition of 15,000 jobs. While 29,200 part-time jobs were added, the full-time employment declined by 300.
Forecast for January 2020: 10,000 jobs are expected to be added
#8: Australia Unemployment Rate (02/20/2020 Thursday 00:30 GMT)
On a seasonally adjusted basis, Australia’s unemployment rate dropped to the 5.1 percent level in December last year from the 5.2 percent level in the prior month. The reading for the month came in below analysts’ expectations of the 5.2 percent level. This is by far the lowest jobless rate ever since March last year as the number of jobless people dropped by 12,900 to the 693,100 level. The participation rate remained steady at 66.0 percent, its lowest level ever since June last year. The participation rate was in line with analysts’ expectations.
Forecast for January 2020: 5.2 percent
#9: United Kingdom Retail Sales (02/20/2020 Thursday 09:30 GMT)
In the United Kingdom, retail trade fell 0.6 percent on a month-on-month basis in December last year after the reading for the prior month was revised upward to a decline of 0.8 percent. Analysts had expected the retail trade to rise by 0.5 percent. This marked the fifth consecutive month of fall in retail sales. This is also the longest period since 1996. Sales declined at clothing, footwear, and textile stores; department stores; food stores; and household goods stores.
Forecast for January 2020: 0.7 percent
#10: Euro Area ECB Monetary Policy Meeting Accounts (02/20/2020 Thursday 12:30 GMT)
Four weeks after the announcement of the Minimum Bid Rate the European Central Bank releases the Monetary Policy Meeting Accounts which provides a detailed record of the most recent meeting of the Governing Board. It also provides in-depth insights into the economic conditions that impacted their decision as regards setting interest rates.
#11: France Flash Services PMI (02/21/2020 Friday 08:15 GMT)
In France, the Services PMI reported by IHS Markit was revised downward to the 51.0 level in January from the preliminary estimate of 51.7 and 52.4 for December last year. The figure for January represented the weakest growth in factory activity ever since April last year. New orders growth came in at the weakest level ever since September and new export orders fell for the first time in as many as four months. Meanwhile, the job creation rate remained unchanged from December 2019. Costs rose sharply as the inflation rate registered the fastest growth in eight months. Output prices, on average, increased at a faster pace. However, firms expressed confidence about an increase in output during this year.
Forecast for February 2020: 51.4
#12: Germany Flash Manufacturing PMI (02/21/2020 Friday 08:30 GMT)
In Germany, the Manufacturing PMI reported by IHS Markit/BME was revised slightly upward to the 45.3 level in January from the preliminary reading of 45.2 and the previous month’s reading of 43.7. The reading for January pointed to contraction for the thirteenth consecutive month in the manufacturing sector. However, this was the lowest decline ever since February 2019. Order book volumes declined the least in as many as 15 months as export sales neared stabilization levels amid an increase in demand from the United States and China. Output also declined at the slowest pace in five months. The job shedding rate remained unchanged from a month before. It has been higher only once in the month of October 2019 ever since January 2010. For the seventh month, the average factory gate prices dropped. Prices declined at a slightly quicker rate amid strong competition and lower input prices. Output expectations for the next 12-month period registered improvement for the fifth month to the strongest level in one-and-a-half years because of brighter international sales prospects.
Forecast for February 2020: 44.8
#13: Germany Flash Services PMI (02/21/2020 Friday 08:30 GMT)
In Germany, the Services PMI reported by IHS Markit came in at the 54.2 level in January, unrevised from the preliminary estimate and higher compared to December’s reading of 52.9. The reading represented the strongest services sector growth in as many as five months amid a faster increase in business activity, employment, and new work inflows. New business increased the most in as many as seven months because of new client acquisitions and increased new work inflows from existing customers. Export orders registered the lowest decline in 11 months and job creation came in at the strongest level in seven months. Cost pressures remained at the highest level in nine months because of the increase in wages, rent, energy, and fuel prices. Expectations for an increase in business activity during the next 12-month period reached the highest level ever since April 2019. Firms’ optimism was supported by the positive trend in new business, plans for expansions, and enhanced marketing efforts.
Forecast for February 2020: 53.9
#14: United Kingdom Flash Manufacturing PMI (02/21/2020 Friday 09:30 GMT)
In the United Kingdom, the Manufacturing PMI reported by IHS Markit/CIPS was revised upward to the 50.0 level in January from the preliminary estimate of 49.8. The index stood at the 47.5 level in the prior month. The reading for January came in at the strongest level ever since April last year and pointed at the stabilization in the sector after registering contraction for eight straight months. New orders rebounded a little bit in spite of the continued drop in exports, but the employment level broadly remained unchanged. This halted nine months of job losses. Purchase inventories declined at the quickest pace ever since May 2013. Input cost inflation remained at the highest level ever since August last year and output charges rose for the forty-fifth consecutive month. Business optimism registered the strongest rise to the eight-month high, driven by a reduction in political uncertainty after the general election, anticipated recovery in export quantities, higher demand, and scheduled new product launches.
Forecast for February 2020: 49.7
#15: United Kingdom Flash Services PMI (02/21/2020 Friday 09:30 GMT)
In the United Kingdom, the Services PMI reported by IHS Markit/CIPS was revised upward to the 53.9 level in January from the preliminary reading of 52.9 and December’s final reading of 50.0. The Services PMI reading for January represented the strongest expansion in the services sector ever since September 2018. New business growth accelerated to the strongest level ever since June 2018 because of reduced uncertainty after the general elections. Additionally, export sales increased marginally, but work backlogs dropped again as capacity was sufficient for meeting only current order books. The job creation pace reached its strongest level ever since July 2019 because of an expected increase in workloads and signs of an upturn in customers’ willingness to spend. Input cost inflation touched a four-month high and the average prices levied by the firms in the services sector increased the most ever since June 2018. Business confidence hit the highest level ever since May 2015 because of signs of an improvement in the country’s economic conditions.
Forecast for February: 53.4
#16: Canada Core Retail Sales (02/21/2020 Friday 13:30 GMT)
In Canada, core retail sales, which exclude autos, rose by 0.20 percent on a month-over-month basis in November last year, rebounding from the reading for October 2019 that was revised downward to a decline of 0.4 percent. This is the first increase in core retail sales in as many as five months. However, the reading came in below analysts’ expectations of 0.4 percent.
Forecast for December 2019: 0.4 percent
#17: United States Flash Manufacturing PMI (02/21/2020 Friday 14:45 GMT)
In the United States, the Manufacturing PMI reported by IHS Markit was revised upward to the 51.9 level in January from the preliminary reading of 51.7. However, the PMI for the month remained below the 52.4 level reported for December 2019. Output growth remained at the same level as in the last month and moderate overall. Manufacturers reported a slower as well as a mild improvement in new order growth. Domestic demand continued to increase, but new export orders declined for the first time ever since September last year. Job creation remained at the slowest pace in four months. Input costs increased amid higher operating expenses and tariffs. Firms expressed reluctant to increase factory gate charges because of the fear of losing a competitive advantage. Output prices rose at the slowest pace in three months. However, business confidence brightened because of higher investments in marketing and hopes of an improvement in client demand, droving the sentiment to the highest level in seven months.
Forecast for February 2020: 51.5