In-depth Analysis

Focus on PMI, RBA, RBNZ, and NFP report

 

On Monday 3rd: Japanese Tankan Large Manufacturing and Tankan Large Non-Manufacturing Indexes are published, along with Manufacturing PMI from Spain, Switzerland, Italy, France, Germany, The Eurozone, the UK, and the US.

On Tuesday 4th: The Reserve Bank of Australia meets for its Monetary Policy Meeting, and the US JOLTS Job Vacancies report is due.

On Wednesday 5th: Australian Retails sales data are released, the Reserve Bank of New Zealand meets for its October Monetary Policy Meeting, Services PMI’s are due from Spain, Italy, France, Germany, The Eurozone, the UK, and the US, the ADP Nonfarm Employment change, and the US Crude Oil inventories are published.

On Thursday 6th: The UK publishes its Construction PMI, the ECB publishes its minutes from the most recent Monetary Policy Meeting, Initial Jobless Claims are due from the US, and the Canadian Ivey PMI is released.

On Friday 7th: Chinese Caixin Manufacturing PMI and Manufacturing PMI’s are due, US Nonfarm Payroll data and Unemployment Rate is released and the Canadian Employment Change and Unemployment Rate is due.

Weekly outlook

 

For the first week of the new quarter there is plenty going on, from Monetary Policy Meetings in New Zealand and Australia – where rates are set to continue increasing until at least the end of this year – to Nonfarm Payroll data and other employment info becoming available in the US.

 

Many countries are also due to publish their Manufacturing and Services PMIs for a look at how the economy is performing from the perspective of purchasing managers. On average, there is an expectation for survey numbers to show conditions are either holding steady or heading towards contraction during global economic uncertainty.

Upcoming important earnings reports

  • Thursday – Constellation Brands and McCormick & Co
  • Friday – Tilray Brands

Monday 3rd of October 

From Japan, the Tankan Large Manufacturing and the Tankan Large Non-Manufacturing Indexes are due to be published for Q3. These reports comment on the business conditions from a large survey of Japanese Manufacturers and Japanese Service Sector Companies respectively. A reading above 0 indicates positive and improving conditions, and below 0 usually indicates deteriorating conditions. Large Manufacturing is expected to increase from 9 to 11, while in the service sector forecasts are that it will remain at 13.

Several Manufacturing PMIs are due today for the month of September. These are from Spain, Switzerland, Italy, France, Germany, The Eurozone, the UK, and the US. 

Remember that readings above 50 are said to show a manufacturing sector in expansion, while below 50 indicates contraction based on large surveys of purchasing managers. 

Spain is looking at a drop from 49.9 to 49.2, the Swiss expect a drop from 56.4 to 54.5, Italy from 48.0 to 47.5, France, Germany, the Eurozone, and the UK the same at 47.8, 48.3, 48.5, and 48.5 respectively. The US ISM Manufacturing is expected to drop from 52.8 to 52.2. 

FOMC member Williams is expected to speak.

Tuesday 4th of October

The Reserve Bank of Australia meets again for a new round of Monetary Policy decisions. It’s widely expected that the Official Cash Rate will again be lifted by as much as 50 basis points to 2.85%. If it does, rate increases will total 275 basis points so far this year.

 

The US JOLTS Job vacancies report for August is published today by the US Bureau of Labor Statistics and is expected to show open jobs have dropped from 11.239M to 10.650M.

FOMC members Williams and Mester are expected to speak. Lagarde is expected to speak.

Wednesday 5th of October

Australia is due to publish its retail sales numbers, where it’s expected for the month of September to hold steady at 0.6%.

 

The Reserve Bank of New Zealand meets for its October Monetary Policy Meeting, where it’s forecast to be increasing headline rates by 50 basis points up to 3.50%. If predictions are correct, the RBNZ will have lifted rates 325 basis points so far this year in its bid to curb inflation.

 

Several Services PMIs are due today for the month of September. These are from Spain, Italy, France, Germany, the Eurozone, the UK, and the US. Readings above 50 show a services sector in expansion, while below 50 indicates contraction, based on large surveys of purchasing managers. 

 

Spain expects a drop from 50.6 to 49.9, Italy 50.5 to 49.2, France, Germany, the Eurozone, and the UK may hold steady at 53, 45.4, 48.9, and 49.2 respectively. The US ISM Non-Manufacturing PMI is expected to drop from 56.9 to 56.

 

The ADP Nonfarm Employment change report is based on the payroll services from ADP. It’s based on the data from 400,000 US business clients across the US and is released two days ahead of the official data from the government. It’s expected to show an increase from 132K to 205K extra employed people for the month of September.

 

Crude Oil Inventories reporting is due from the U.S, which measures the difference in the weekly stores held by firms in the US.

Thursday 6th of October

 

The UK publishes its Construction PMI data today, a reading above 50 suggests expansion in the construction industry, while a level below 50 points to contraction. A drop is expected from 49.9 to 48.0.

 

The ECB publishes its minutes from the most recent Monetary Policy Meeting.

 

The US is due to release its latest Initial Jobless Claims for the week, with an expected increase of people filing for unemployment insurance to 203K from 193K.

 

The Ivey Purchasing Managers Index (PMI) is a Canadian index that surveys a selection of companies from around the country. A level above 50 is indicative of the manufacturing sector expanding, while below 50 is suggestive of contraction. After a large increase the previous month, it’s expected to be another small increase from 60.9 to 62.3 in September.

Friday 7th of October

 

From China, the Manufacturing PMI and the Caixin Manufacturing PMI are published today for a look at the activity of purchasing managers and how it relates to the economy.

 

The highly anticipated Nonfarm Payroll report from the US measures the difference in jobs created from the previous month. This report from September will be closely followed by traders and the Federal Reserve, and is expected to show a drop from 315K to 250K. The US unemployment rate is also published today and is expected to hold at 3.7%.

 

The Canadian Employment Change report is expected to show an increase in employed persons from the previous month from -39.7K to 20K, and the Unemployment Rate for the country is expected to remain unchanged at 5.4%.

 

 

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