Another busy week for markets around the world: Covid Delta cases, central bank meetings and minutes on monetary policy, markets, inflation and the immediate outlook for oil prices.
The OPEC meeting continues tonight in a third session looking for a deal (see Commodities story).
For Australia, the most important event is concerned is tomorrow’s July monetary policy meeting which will decide the bank’s interest rate settings for the next three years, its quantitative easing approach and assessment on the chances of getting unemployment low and wages high, as the bank wants (see separate story).
Besides the RBA meeting, Governor Phil Lowe has a media conference as well tomorrow and a big speech from him Thursday on labour markets and monetary policy.
Australia also sees the release on retail sales for May (a 0.1% rise as in the preliminary data last month) and flat building approvals for the same month, according to Dr Oliver.
Other central banks activities include Malaysia’s meeting, while there are minutes from the June Federal Reserve FOMC meeting which will be scrutinised for more hints about why the central bank’s earlier-than-expected rate hikes through the ‘dot plot’.
But the angst about the changed timetable (apparently) have been calmed by Fed chair, Jay Powell and the bond market believes him – the 10-year US Treasury bond yield fell to just over 1.44% on Friday from around 1.55% a week earlier and the most recent high of 1.77% in late March.
US June quarter company profit results will start to emerge this week with the consensus looking for a 62% year on year rise boosted by base effects from last year’s slump but the AMP’s chief economist, Shane Oliver says “the rebound in various macro variables suggesting this could end up being +90% or so.”
The Fed’s comments on inflation and an idea when it might start easing will also be examined while real data on cost pressures comes from China where its June inflation data will be carefully tracked after the latest official and Caixin manufacturing PMIs suggested easing price pressures.
China’s inflation data for June will be out on Friday and is expected to see CPI inflation unchanged at 1.3% year on year and for producer price inflation to ease slightly to 8.8% year as base effects from a year ago start to drop out. Credit data is also due to be released from Friday.
