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Key Events In The Coming Week

With the snoozer of an FOMC meeting in the rearview mirror, as well as Scotland's predetermined independence referndum, last week's key events: the BABA IPO and the iPhone 6 release, are now history, which means the near-term catalysts are gone and the coming week will be far more relaxed, if hardly boring. Here is what to expect.

As DB summarizes, looking at the day ahead and beyond, US existing home sales and euroarea consumer confidence for September are the main release for today although we’ll also pay some attention to any soundbites from the Fed’s Dudley at a Bloomberg summit today. Draghi will also speak before the EU parliament in Brussels at 3pm local time. Then we have PMI Tuesday with the release of the Markit/HSBC PMI manufacturing September readings for China and the Eurozone. The former should provide us with further clues in light of the recent downward momentum in China data flow. On Wednesday, we’ll get US new home sales, Italian consumer confidence, and the German IFO report. The US durable goods data in August will be a highlight on Thursday on top of the usual weekly jobless claims report. We will wrap up the week on Friday with the third revision to the Q2 US GDP data where consensus is looking for a small upward revision. On top of all, this week also sees a handful of Fedspeak (Kocherlakota, Bullard, Powell, George, Mester, Evans and Lockhart) right on the heels of the FOMC meeting last week so we should get more Fed-related news flow in the coming days.

Visually:

And a complete breakdown of the week's events from Goldman:

In DMs, highlights of next week include US GDP and UMichigan Confidence, PMI in Euro area, Japan CPI.

  • [Monday] US Existing Home Sales.
  • [Tuesday] France GDP, DMs Composite PMI in Euro area (expect 51.8), France and Germany.
  • [Wednesday] Germany IFO Business Climate.
  • [Thursday] US Durable Goods.
  • [Friday] US GDP and UMichigan Confidence, Japan CPI.

In EMs, highlights of next week include MP Decisions in Colombia, Czech Republic, Hungary, Israel, Taiwan and Turkey.

  • [Monday] Israel MP Decision (expect 10bp cut).
  • [Tuesday] China HSBC Manufacturing PMI, Hungary MP Decision (expect rates on hold).
  • [Wednesday] Argentina GDP, Mexico Economic Activity.
  • [Thursday] MP Decisions in Taiwan, Turkey (expect rates on hold) and Czech Republic (expect rates on hold).
  • [Friday] Colombia MP Decision (expect rates on hold).

FULL CALENDAR

Monday, September 22

  • Events: Speeches by ECB’s Draghi, Fed’s Dudley, US Council of Economic Advisors’ Furman, FDIC’s Gruenberg and Hoenig, Fed’s Kocherlakota and BoC’s Wilkins, Brazil Quarterly Inflation Report.
  • United States | [MAP 2] Existing Home Sales (Aug): Consensus 5.20M, previous 5.15M
  • United States | Chicago Fed Nat Activity Index (Aug): Previous 0.39
  • Hong Kong | CPI Composite YoY (Aug): Previous 4.00%
  • Israel | MP Decision: We expect a 10bp cut (in the Base Rate to 0.15%, below consensus) on the back of the very soft August inflation print, the downward revision to the 2014Q2 GDP print and the preliminary signs of a slowdown in the housing market. Market pricing suggests that there is a 50% probability of a 10bp rate cut over the next three months. The BoI surprised the market last month by cutting rates to an all-time low (0.25%), citing modest growth, a “slow” global recovery and, importantly, the soft inflation environment (e.g., inflation fell to +0.3% yoy in July). Since then, inflation has fallen to +0.0% yoy in August, the 2014Q2 GDP print was revised down to 1.5% (from 1.7%) and house prices have slowed sequentially. Therefore, we expect the ‘dovish’ central bank to surprise the market once again by implementing a modest 10bp rate cut at this month’s meeting (and to cut rates by a total of 20bp in 2014H2; see here for details).
  • Also interesting: [DM] Euro area Consumer Confidence; Denmark Consumer Confidence; Italy Industrial Orders; New Zealand Westpac Consumer Confidence [EM] Taiwan Unemployment and Export Orders; Unemployment in Israel and Mexico; Mexico Retail Sales.

Tuesday, September 23

  • Events: Speeches by Fed’s Bullard, Fed’s George, Sweden Riksbank’s Ekholm, Hungary Central Bank’s Nagy.
  • United States | [MAP 1] Richmond Fed Manufact. Index (Sep): Consensus 10, previous 12
  • France | GDP QoQ (2Q F): Previous 0.00% (0.10% yoy)
  • DMs | Markit Composite PMI (Sep P): Euro area (GS 51.8, previous 52.5), France (previous 49.5), Germany (previous 53.7)
  • DMs | Markit Manufacturing PMI (Sep P): US (consensus 58, previous 57.9), Euro area (consensus 50.6, previous 50.7), France (previous 46.9), Germany (consensus 51.4, previous 51.4)
  • DMs | Markit Services PMI (Sep P): Euro area (consensus 53.1, previous 53.1), France (previous 50.3), Germany (consensus 54.8, previous 54.9)
  • China | HSBC China Manufacturing PMI (Sep P): Consensus 50.1, previous 50.2
  • Singapore | CPI NSA MoM (Aug): Consensus 0.80% (1.20% yoy), previous -0.30% (1.20% yoy)
  • Taiwan | [MAP 4] Industrial Production YoY (Aug): Consensus 7.00%, previous 6.08%
  • Hungary | MP Decision: We expect rates on hold (at 2.10%, in line with consensus) for a second month in a row, after the central bank declared an end to a two-year easing cycle in July. Macro outlook and conditions have changed little since the previous MPC meeting. But we continue to see the risk that the MPC may cut rates further this year.
  • Also interesting: [DM] US FHFA House Price Index; Canada Retail Sales; France Manufacturing Confidence; UK Public Sector Net Borrowing; Australia Roy Morgan Consumer Confidence [EM] Hungary CA; Poland Unemployment and Retail Sales; Argentina Trade Balance; Mexico Retail Sales.

Wednesday, September 24

  • Events: Speeches by Fed’s Mester, Fed’s Evans and RBA’s Stevens, RBA’s Financial Stability Review.
  • United States | New Home Sales MoM (Aug): GS 2.0%, consensus 4.40%, previous -2.40%
  • Germany | [MAP 3] IFO Business Climate (Sep): Consensus 105.7, previous 106.3
  • Japan | Markit/JMMA Japan Manufacturing PMI (Sep P): Previous 52.2
  • Argentina | [MAP 5] GDP YoY (2Q): GS -0.8%, previous -0.20%
  • Mexico | [MAP 5] Economic Activity IGAE YoY (Jul): GS 2.6%, previous 2.73%
  • Also interesting: [DM] US MBA Mortgage Applications; Italy Consumer Confidence; Norway Unemployment; Sweden Economic Tendency Survey; New Zealand Trade Balance [EM] Czech Republic Consumer Confidence; Brazil CA, Foreign Direct Investment and Consumer Confidence.

Thursday, September 25

  • Events: ---.
  • United States | Durable Goods Orders (Aug): GS -16.5%, consensus -17.00%, previous 22.60%
  • United States | Markit US Services PMI (Sep P): Previous 59.5
  • United States | Markit US Composite PMI (Sep P): Previous 59.7
  • Taiwan | MP Decision
  • Turkey | MP Decision: We expect rates on hold (Benchmark Repurchase Rate at 8.25%, in line with consensus; O/N lending rate at 11.25% and O/N borrowing rate at 7.5%). We also do not see any changes to the main parameters of CBRT’s macroprudential tools. Finally, we expect the policy statement to be carefully balanced, signaling some caution in the short term but also leaving the door open to the possibility of further easing, contingent on market conditions and the inflation outlook. In this context, we expect the bank to leave the key phrase unchanged, “…the tight monetary policy stance will be maintained, by keeping a flat yield curve, until there is a significant improvement in the inflation outlook”.
  • Czech Republic | MP Decision: We expect rates on hold (Repurchase Rate at 0.05%, in line with consensus) and for the CNB Board to preserve its current, accommodative policy stance at the upcoming meeting. With this meeting falling between forecast updates, we do not expect the Board to make any strong comments on policy direction.
  • Also interesting: [DM] US Initial Jobless and Continuing Claims and Kansas City Fed Manf. Activity; Euro area Money Supply; Italy Retail Sales; PPI in Spain and Sweden; Japan PPI; UK CBI Reported Sales; Australia Job Vacancies [EM] Hong Kong Trade Balance; Philippines Trade Balance; Brazil Unemployment.

Friday, September 26

  • Events: Speech by RBA’s Richards.
  • United States | [MAP 4] GDP Annualized QoQ (2Q T): GS 4.7%, consensus 4.60%, previous 4.20%
  • United States | [MAP 1] Univ. of Michigan Confidence (Sep F): GS 84.6, consensus 85, previous 84.6
  • United States | Personal Consumption (2Q T): GS 3.1%, previous 2.50%
  • Germany | GfK Consumer Confidence (Oct): Consensus 8.5, previous 8.6
  • Japan | Natl CPI Ex Food, Energy YoY (Aug): GS 2.3%, consensus 2.30%, previous 2.30%
  • Singapore | [MAP 5] Industrial Production YoY (Aug): Consensus 3.60% (-1.50% mom sa), previous 3.30% (2.70% mom sa)
  • Argentina | [MAP 5] Economic Activity Index YoY (Jul): GS -0.8% (-0.3% mom), previous 0.00% (0.30% mom)
  • Colombia | MP Decision: We expect rates on hold (Overnight Lending Rate at 4.50%, in line with consensus), pausing the rate normalization cycle after five consecutive hikes. The policy statement is likely to signal that the board remains divided, with a minority of directors voting for yet another increase to the reference rate. The MPC should also deliberate on the extension of the ongoing FX intervention program. We expect the directors to either discontinue the program altogether or to extend it to the 4Q2014 while reduce its purchase ceiling to US$1.0bn from US$2.0 currently.
  • Also interesting: [DM] US Core PCE (QoQ); France Consumer Confidence; Italy Business Confidence; Sweden Trade Balance [EM] Philippines Balance of Payments; South Korea Consumer Confidence; Taiwan Leading Index; Hungary Unemployment; Argentina CA; Brazil Bank Lending; Mexico Trade Balance.

Source: Goldman, Deutsche Bank, Bank of America