In Australia, the focus will initially be on the Reserve Bank’s monthly Board meeting tomorrow with many economists tipping a rate rise (again).
As well, the day after its our 4th quarter economic growth figures, and in the US on Friday it’s the unemployment data for last month.
The consistent message from the RBA and its senior officials in the past month has been that more interest rate hikes are likely, reflecting the bank’s fairly upbeat outlook for the Australian economy.
Indeed RBA Governor Glenn Stevens indicated he thought four more rate rises (to 4.75%) might be need to slow the economy to a point where inflation and wage pressures (still not evident) pose little danger.
Given the softness in data for retail sales and housing finance released since the last meeting and ongoing global concerns regarding sovereign debt, the central bank could wait.
The emergence of softer economic conditions in Europe late last year and January and in the US housing sector in January and February, is being closely watched by the bank, according to the recent speeches from senior officials.
So even though Australian house prices are rising, business investment is gathering pace (with construction solid) and consumer and business confidence are on the rise, the bank could decide to sit on its hands for another month.
Or it could decide to increase rates to be safe.
A worry for the bank was the sharp downturn in business conditions in January, as shown by the NAB’s business survey for that month.
A rate rise tomorrow would take the cash rate to 4%.
The RBA board will get figures on retail trade and building approvals for January during the meeting at 11.30 am.
These figures could clinch the rate decision, depending on the strength or otherwise in the data.
After the rate decision, it’s the 4th quarter GDP data that will grab the headlines the next day.
As a lead up the Australian Bureau of Statistics releases the December quarter and 2009 balance of payments and business indicators for the December quarter (and 2009).
The latter will reveal the impact business stocks and wages and profits will have on the growth figures (and tell the RBA just where the economy is in the recovery/inventory cycle).
The balance of payments will give us an idea of how the external account will impact the GDP estimates.
But a complicating set of numbers comes tomorrow: the estimates for government finances in the December quarter.
Those figures usually have an impact on the growth estimates that is hard to work out from just the ABS data.
The key points in the GDP figures will be the impact of stocks, the trade account, and investment and government finances, seeing the heavy spending on stimulus measures early last year has passed.
The AMP’s Dr Shane Oliver says December quarter GDP is likely to have increased by 0.8%, or by 2.2% over the year, with strength in consumer spending, business investment and public investment offsetting weakness in net exports.
Australian car industry sales figures are due for release later in the week, along with a report on the service sector activity.
Before that, later today actually, we get the Performance of Manufacturing Index (PMI) which will tell us if the slight improvement in this sector last month has continued.
The Australian Bureau of Agricultural and Resource Economics releases its first look for 2010 at our huge commodities sector tomorrow: there will be new forecasts on the value of exports and production.
No results are due, but Sigma Pharmaceuticals should update the market today on its 2010 results after asking for the shares to be suspended last week.
The shares were trading at 90c before the suspension on Thursday.
Sigma asked for the suspension because: "Sigma expects to make an announcement to the market in relation to revised earnings guidance arising from year end adjustments.
"Sigma expects to make an announcement to the market concerning the revised earnings guidance before the commencement of trading on 1 March 2010."
In the US we get some important data as well.
This week is pretty busy on the data front for the US.
The key ISM business conditions index, and then a separate one on the services sector, will help update us on the health of the US economy in light of some signs of a weakening.
But with reports German banks and the country’s government might be crafting a plan to support Greece’s emerging and immediate debt problems, worries about sovereign debt might ease.
But February’s non-farm payrolls report on Friday and the unemployment rate, will give investors another sign of the progress of the recovery.
The consensus forecast, according to economists polled by Reuters, calls for a loss of 50,000 jobs in February, compared with a decline of 20,000 in January.
The unemployment rate is forecast to rise to 9.8% in February from 9.7% in January.
January saw a surprise fall as more people stopped looking for work.
But the recent snow storms and harsh winter weather may contribute to the weaker February jobs picture and make the data even harder to forecast.
Besides payrolls, other data which will be released include January personal income and spending, as well as construction spending for January.
Fourth-quarter earnings reports are winding down; natural gas producer and pipeline operator El Paso Corp and major office supplies retailer Staples, are two reporting.
February domestic car and truck sales are due out tomorrow.
The industry expects to report a small fall in
