US data continued to remain upbeat as data released last week such as consumer sentiment, employment and manufacturing PMI were better than expected. This has raised the chances of an interest rate hike this month. In February, consumer confidence exceeded forecast and came in at 114.8 points, showing improvements in current conditions and expectations. On the other hand, the ISM Manufacturing PMI hit the 57.7 level, beating expectations as manufacturers remained optimistic about Trump’s new policies. The employment data also came in strong with the jobless claims declining by 19,000 for the last reporting.
The key data releases for the coming week include Australian and Eurozone interest rate decisions and the U.S. (both the ADP and NFP releases) and Canadian employment data. Here is an outlook on this week’s market movers:
#1: Australia Retail Sales (03/06/2017 Monday 00:30 GMT)
Retail sales fell unexpectedly by 0.1 percent on month-on-month basis in the month of December last year following a 0.1 percent (revised downwards) increase in the previous month. Market expected the retail sales to increase by 0.3 percent in December. Retail sales fell for the first time since July last year because of a decline in sales in household goods and other retailing segments. Forecast for January 2017: 0.4 percent gain.
#2: Australia Cash Rate (03/07/2017 Tuesday 3:30 GMT)
The Australian central bank maintained the cash rate at the same record low level of 1.5 percent in the meeting held on February 7, 2017 as expected. The Reserve Bank of Australia noted that the economic growth would be around 3 percent over the next few years boosted by increases in exports in the resources sector, but the inflation is likely to remain low. Forecast for March: 1.5 percent.
#3: Reserve Bank of Australia Rate Statement (03/07/2017 Tuesday 03:30 GMT)
The central bank releases the rate statement on the first Tuesday of every month, excluding January, along with the cash rate announcement. It is primary tool that the Reserve Bank of Australia uses for communicating with investors as regards the monetary policy. It consists of details about the decision on cash rate and commentary on economic conditions that led to the decision. Moreover, it provides an economic outlook and clues on future decisions.
#4: New Zealand GDT Price Index (03/07/2017 Tuesday 12:00 GMT)
In the milk auction held on February 21, 2017, the GDT Price Index dropped 3.2 percent as against the 1.3 percent gain recorded in the prior auction. The price of milk powder (whole) dropped 3.7 percent.
#5: Canada Trade Balance (03/07/2017 Tuesday 13:30 GMT)
In December 2016, Canada’s trade surplus narrowed to C$0.92 billion from that for the previous month, which was revised upward to C$1.01 billion. However, the reading for December came in above analysts’ expectation for a surplus of C$0.35 billion. Exports rose 0.8 percent on higher energy product prices and imports rose 1 percent on stronger industrial machinery and aircraft purchases. Forecast for January 2017: surplus of C$0.2 billion.
#6: China Trade Balance (03/08/2017 Wednesday 02:00 GMT)
China’s trade surplus increased faster than analysts expected in January, according to data released by the General Administration. The trade surplus was 355 billion yuan compared to 275 billion yuan recorded in December 2016. The reading came in market forecasts for a surplus of 295 billion. Forecast for February: surplus of 173 billion yuan.
#7: U.K. Annual Budget Release (03/08/2017 Wednesday 12:30 GMT)
This document gives an outline of the budget for the year. It provides details regarding expected income, expenditure and borrowing; financial objectives; and planned investments. Traders care because domestic government spending as well as borrowing impacts the economic growth of the country.
#8: U.S. ADP Non-Farm Employment Change (03/08/2017 Wednesday 13:15 GMT)
Private businesses employed 246,000 people in January 2017, compared to 151,000 (revised downward) in December 2016. The data for January 2017 was well above analysts forecast of 165,000. This is the highest gain in the last seven months. Forecast for February: 184,000.
#9: U.S. Crude Oil Inventories (03/08/2017 Wednesday 15:30 GMT)
In the U.S., crude oil stocks increased by 1.5 million barrels during the week that ended on February 24, 2017, after recording a 0.56 million barrels increase in the week before. The reading, however, came in below market expectations for an increase of 3.079 million barrels.
#10: China CPI (03/09/2017 Thursday 01:30 GMT)
In January, consumer inflation in China quickened because of holiday effect. Prices at factory gates increased faster than expected because of rising oil and gas prices. The consumer price index grew 2.5 percent on year-on-year basis against market expectation for a 2.4 percent increase. In December 2016, the CPI stood at 2.1 percent. Forecast for February: 1.9 percent.
#11: European Central Bank Minimum Bid Rate (03/09/2017 Thursday 12:45 GMT)
The European Central Bank (ECB) maintained its minimum bid rate at zero percent for the eighth month. The ECB also said that it will maintain the pace of bond-purchases as expected. The deposit and lending rate were left at -0.4 and 0.25 percent, respectively.
#12: European Central Bank Press Conference (03/09/2017 Thursday 13:30 GMT)
The European Central Bank holds a press conference approximately 45 minutes after the announcement of the minimum bid rate. It has two parts: reading of a prepared statement and open to press questions. Volatility can be expected as traders look for clues on future interest rate decisions.
#13: U.S. Jobless Claims (03/09/2017 Thursday 13:30 GMT)
The number of American people filing for jobless benefits declined 19,000 to 223,000 during the week that ended on February 25, 2017. During the previous week, as many as 242,000 (revised figure) people filed for jobless claims. The reading, however, was below analysts’ expectation of 243,000. This is the lowest reading since March 1973. Forecast for the next reporting period: 239,000.
#14: U.K. Manufacturing Production (03/10/2017 Friday 9:30 GMT)
In the U.K., manufacturing production rose by 4 percent on year-on-year basis in December 2016 after it increased 1.7 percent (revised upward) in November 2016. The reading for December beat market expectations for an increase of 1.8 percent. On a month-on-month basis, factory output rose by 2.1 percent. Forecast for January 2017: -0.6 percent.
#15: Canada Employment Change/Unemployment Rate (03/10/2017 Friday 12:30 GMT)
Canada added as many as 48,300 jobs in the month of January 2017 and beat market expectations for a decline of 5,000 jobs. The jump in addition of jobs was attributed to the increase in both part-time and full-time work. While full time jobs increased by 15,800, part-time jobs by 32,400.
In Canada, the unemployment rate dropped to 6.8 percent in the month of January of 2017 from the 6.9 percent rate recorded in December last year. The reading for January 2017 also came in below analysts’ expectation of 6.9 percent.
#16: U.S. Average Hourly Earnings (03/10/2017 Friday 12:30 GMT)
In the United States of America, the average hourly earnings rose by 0.1 percent in the month of January 2017 from the 0.2 percent (revised downward) gain recorded in the previous month. However, the reading for January came in below economists’ expectation for an increase 0.3 percent in average hourly earnings. Forecast for February: an increase of 0.3 percent in average hourly earnings.
#17: U.S. Non-Farm Employment Change (03/10/2017 Friday 12:30 GMT)
Non-Farm Payrolls data released in the U.S. showed that the number of jobs increased by as much as 227,000 in January 2017, much more than the reading of 157,000 (revised upward) reported for the month of December 2016. Market had expected an employment increase of 175,000. Employment increase was recorded in the retail, construction and financial sectors. Employment change forecast for February 2017: 185,000.
#18: U.S. Unemployment Rate (03/10/2017 Friday 12:30 GMT)
Unemployment rate in the U.S. rose to 4.8 percent in the month of January 2017 from 4.7 percent in December 2016. Market had expected the reading to come in at 4.7 percent. The number of unemployed people in America remained unchanged at 7.6 million. The labor force participation rate rose by 0.2 percentage point to 62.9 percent.