AU Data
- Mon Tentative HIA New Home Sales previous 0.5% m/m
- Mon 10.30 MI Inflation Gauge previous 0.9% m/m
- Mon 11.30 Private Sector Credit previous 0.1% m/m expectation 0.2% m/m
- Mon 11.30 Company Operating Profits previous -7.2% q/q expectation -4.4% q/q
- Tue 09.30 AIG Manufacturing Index previous 44.5
- Tue 11.30 Building Approvals previous 9.3% m/m expectation 3.3% m/m
- Tue 11.30 Current Account previous -4.6b expectation -10.3b
- Tue 14.30 RBA Interest Rate Decision previous 3.0% expectation 3.0%
- Tue 16.30 Commodity Prices previous -31.8% y/y
- Wed 11.30 GDP previous 0.4% q/q expectation 0.6% q/q
- Thu 09.30 AIG Services Index previous 44.1
- Thu 11.30 Trade Balance previous -0.44b expectation -0.80b
The value of construction work completed in Q2 declined 0.1% from the previous quarter, underpinned by engineering construction that rose 5.7% in the quarter. However, both residential and non-residential building dragged down the overall value, falling 2.6% and 9.5% respectively. Encouragingly Private New Capital Expenditure rose 3.3% in Q2, suggesting that the economy may be growing faster than previous estimates. Future spending plans have also been revised up, which bodes well for GDP growth into 2010. New Motor Vehicle Sales (-6.9% m/m) fell back sharply in July from the tax break driven surge in the previous month and are now down 10.4% from a year earlier. This week the AIG Service and Manufacturing indices will be watched closely, as well as comments from the RBA after the monetary policy meeting, although no change in official rates is expected this month.
NZ Data
- Mon 13.00 NBNZ Business Confidence previous 18.7
- Thu 13.00 ANZ Commodity Prices previous 1.0% m/m
The number of New Dwelling Approvals recovered in July as the housing sector showed signs of a gradual emergence from recession. Consents rose 5.0% in the month, reversing June’s 9.6% fall, which was the first decline in 3 months and although still down 16.8% from a year earlier the data has shown some improvement after hitting a 27 year low in January. New Zealand posted a $163 million trade deficit in July as exports fell 7.3% (led by crude oil, meat and edible offal) and imports fell 21% (led by petroleum, vehicles and parts) from a year earlier. Total household borrowing rose 0.3% in July with housing related borrowing up 2.8% from a year earlier but consumers remain cautious with retail borrowing down 3.6% year-on-year. Business Confidence will be the focus this week in a thin data diary.
US Data
- Mon 23.45 Chicago PMI previous 43.4 expectation 47.4
- Wed 00.00 Manufacturing PMI previous 48.9 expectation 50.2
- Wed 00.00 Pending Home Sales previous 3.6% m/m expectation 1.7% m/m
- Wed 00.00 Construction Spending previous 0.3% m/m expectation -0.3% m/m
- Wed 00.00 ISM Manufacturing Prices previous 55.0 expectation 57.3
- Wed Tentative Total Vehicle Sales previous 11.2m expectation 12.0m
- Wed 22.15 ADP Non-farm Payrolls previous -371k expectation -250k
- Wed 21.30 Challenger Job Cuts previous -5.7% y/y
- Wed 22.30 Revised Non-farm Productivity previous 6.4% y/y expectation 6.1% y/y
- Wed 22.30 Revised Unit Labour Costs previous -5.8% q/q expectation -5.3% q/q
- Thu 00.00 Factory Orders previous 0.4% m/m expectation 1.5% m/m
- Thu 04.00 FOMC Meeting Minutes
- Thu 22.30 Unemployment Claims previous 570k expectation 563k
- Fri 00.00 ISM Non-manufacturing PMI previous 46.4 expectation 48.3
- Fri 22.30 Non-farm Payrolls previous -247k expectation -223k
- Fri 22.30 Unemployment Rate previous 9.4% expectation 9.5%
- Fri 22.30 Average Hourly Earnings previous 0.2% m/m expectation 0.1% m/m
The housing market continues to show signs of stabilizing; the Case Schiller House Price Index (-15.4% y/y) recorded its smallest drop since April 2008, the largest improvement from the previous month in 4 years and a 2.9% increase from Q1 that is the first gain in 3 years. New Home Sales rose 9.6% on an annualised basis, the 4th straight month of improvement and new home inventory is now down to 7.5 months, which is the lowest since April 2007. The volatile Durable Goods Orders series showed a monthly increase of 4.9% with transportation (+18.4%) and capital goods (+9.5%) orders leading the rise. Last week’s Q2 GDP report showed the US economy shrank 1.0% on an annualised basis as businesses continued to reduce inventories at a record pace. Not surprisingly Consumer Spending (-1.0%) remained weak as the previous saviours of US recessions battled with falling asset values and job insecurity. A measure of Consumer Sentiment (65.7) released on Friday was largely unchanged from the previous month and the index of consumer expectations for 6 months forward, which closely projects the direction of consumer spending, improved from 63.2 to 65. This week offers a busy data diary that will reach a crescendo on Friday with Non-farm Payrolls.
JP
N Data
- Mon 09.15 Manufacturing PMI previous 50.4
- Mon 09.50 Preliminary Industrial Production previous 2.3% m/m expectation 1.4% m/m
- Mon 09.50 Retail Sales previous -2.9% y/y expectation -3.3% y/y
- Mon 11.30 Average Cash Earnings previous -7.0% y/y expectation -6.3% y/y
- Mon 15.00 Housing Starts previous -32.4% y/y expectation -30.3% y/y
- Mon 15.30 BOJ Governor Shirakawa Speech
- Wed 09.50 Monetary Base previous 6.1% y/y expectation 6.6% y/y
- Fri 09.50 Capital Spending previous -25.3% y/y expectation -22.9 y/y
Japan’s core consumer prices shrank by a record 2.2% in July from a year earlier as weak demand dragged the world’s second largest economy deeper into deflation. This is the 3rd straight month of record falls in the index and prospects show little sign of improvement as seen in the Tokyo CPI for August, available a full month before the nationwide data, that fell by a record 1.9% year-on-year. Japanese exports slid 1.3% m/m and 36.5% y/y in July; a potential sign that the impact of stimulus packages in major economies across the world is starting to wane. Conditions at home are certainly no better, with Household Spending tumbling 2.0% y/y and the Corporate Services Price Index falling by a record 3.4% in July, indicating that both consumer and business-to-business (advertising, marketing and leasing fees) demand is extremely weak. Early week attention will be focused on the general election in Japan that looks likely to end more than half a century of conservative Liberal Democratic Party rule with the election of the main opposition party (DPJ). A convincing win by the DPJ would open the possibility of clearing a policy deadlock in parliament, where the opposition party controls the upper house and can delay legislation.
Interest rate outlook
| Country |
Current rate |
Last change |
Date of change |
Next meeting |
| AUS (RBA) |
3.00% |
-25bps |
07/04/09 |
1st Sep |
| NZ (RBNZ) |
2.50% |
-50bps |
30/04/09 |
10th Sep |
| US (FED) |
0-0.25% |
-75bps |
16/12/08 |
23rd Sep |
| JPN (BOJ) |
0.10% |
-20bps |
19/12/08 |
17th Sep |