As investors and traders return from summer holidays over the next week or so, especially after the US Labor Day holiday next weekend, there will be some very nervous punters among their ranks after Fed Chair Jerome Powell’s “truth bomb” on monetary policy and Friday’s Wall Street rout.
Powell has forced markets – especially investors, economists and analysts to get real on inflation and rate rises and stop trying to call the top for inflation and interest rates before the Fed is certain the price pressures passed and inflation is indeed falling.
This increases the focus on this week’s US August unemployment figures to be released on Friday and will dominate the minds of all ahead of the long weekend.
July saw 528,000 new jobs reported and the unemployment rate was 3.5%, easily topping the market estimates. Wage growth also jumped 0.5% for the month and 5.2% from a year ago, slightly higher than estimates but less than the 5.7% rate in January.
Economists do not expect a repeat in August with many estimates around 285,000 to 310,000 and unemployment remaining around 3.5%. Wages are forecast to have risen at an annual rate of 5.1% to 5.3% in August.
US house prices (the Case Schiller survey) and consumer confidence and job openings and resignations will also be released this week.
Germany will release its preliminary August inflation rate on Tuesday. The following day, France and the Eurozone as a whole will release data on inflation in August and early unemployment figures.
Thursday sees the release of global activity survey results for manufacturing in Japan. Australia, China (two), other parts of Asia, NZ, Europe and the OK and then the US.
The US June 30 reporting season continues to wind down this week with a smattering of companies large and small releasing figures. These include HP Inc, Hewlett Packard, Lululemon, Campbell Soup, Hormel Foods, Best Buy, Big Lots, Land End.
The figures from Best Buy will be closely watched after it downgraded its guidance for 2022 for a third time in late July.
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In Australia there’s the start of month data on house prices on Thursday, early retail sales for July later today, building approvals for July tomorrow and lending finance data, also for July on Thursday.
But the major data releases (besides the monthly activity survey results for manufacturing) will be the start of the run up to the June quarter national accounts on Wednesday week.
That will see data on the value of construction work done in the three months to June on Wednesday and then the private capex figures for the same quarter on Thursday.
The Australian June 30 reporting season wraps up from today through Thursday.
Watch for key results from Fortescue Metals Group and Woodside Energy.
