A big week for the 2018-19 budget strategy of the Federal Government with the Wage Price Index for the March quarter and the April jobs data to be released.
The Wage price Index is expected to have remained steady at 2.1% overall, which will make it much harder for the government to achieve its 2.5% forecast for the year to June (down from 2.75% in the budget last May).
Unemployment is expected to remain around 5.5%, with around 10,000 new jobs created. Of interest is whether the weakening jobs growth seen in the March quarter has spilled over into the the start of the current quarter.
Some economists though wonder if there will be what’s called ’statistical give back’ when after a couple of months of good or poor data. That’s when a new set of figures reverse what has happened in the preceding period to balance things out.
Besides these releases, the minutes from the last RBA Board meeting are out tomorrow and won’t contain anything that hasn’t been already outlined by the bank or Governor Phil Lowe in the past two weeks in a statement, a speech and the second Monetary Policy statement of the year.
The latest Westpac consumer confidence survey is out on Wednesday and will be watched closely for a post-Budget bounce.
And there are profits from Dulux and Elders and one also expected from Aust Agricultural Co. And also watch for more pre-June 30 trading updates and guidance changes.
In the US, April retail sales figures are out tomorrow night our time and economists think they will stay solid around 0.3%.
And still in retail a number of leading retailers release March quarter results this week, starting with Walmart and including department store group, Macy’s.
Only 10 companies listed in the S&P 500 are down to report results. So far 444 S&P 500 companies have reported.
A survey of home builders confidence is forecast to remain strong, (also Tuesday), while housing starts will remain flat, and industrial production. It is forecast to show a solid rise to rise solidly (both out on Thursday).
The New York and Philadelphia regional manufacturing conditions indexes will also be released.
Japanese March quarter GDP on Wednesday is expected to reveal a small contraction of around 0.1% quarter on quarter, according to the AMP’s Chief economist, Dr Shane Oliver.
He also says that Japanese core inflation for April on Friday is expected to remain weak and well below target at 0.5% year on year.
China’s April activity data tomorrow is expected to show a small rise in industrial production year on year, retail sales growth remaining steady around 10% and fixed asset investment remaining around 7.5%.
Watch though for the figures on real estate investment, they will tell us more about the pressures in the Chinese economy at the moment than many other figures. Match them to data on production, especially steel, cement and power.
Chinese Vice Premier Liu He is expected to travel to Washington for trade talks with Treasury Secretary Steven Mnuchin this week but the meeting could be delayed because of continuing splits within the Trump administration on trade policy.
