Still more action for markets and investors to consider, even though the year is almost over.
There’s the fallout from yesterday’s Presidential poll in Austria and the Italian referendum – which is the more vital of the two. Results from the Italian vote will be in around midday.
Central banks meet and release statements in Australia, India (where the note replacement stuff up could see a rate cut), Canada and the European Central Bank.
Global surveys of service sector activity will be out today and tonight, while trade and inflation figures for China will be issued later in the week.
In Australia, the RBA is expected to leave rates on hold at its final meeting for the year tomorrow.
The AMP’s Dr Shane Oliver wrote at the weekend "While recent data points to soft September quarter GDP growth to be released on Wednesday this is unlikely to be enough to move the RBA to cut rates given recent upbeat commentary on the economy from both Governor Lowe and Assistant Governor Kent.
“However, as noted above we remain of the view that the RBA will cut rates again in the first half of next year reflecting downside risk to both growth and inflation,” Dr Oliver wrote.
On the data front in Australia, Dr Oliver sees the September quarter GDP growth on Wednesday at just 0.2% quarter on quarter, or 2.5% year on year (3.3% in the year to June) driven by weak business investment, retail sales, housing investment and trade.
However, he warned that there is also “a high risk of a fall in GDP."
Feeding into the September quarter National Accounts will be data for production, profits and inventories (today) and net exports (current account for the September quarter) and public demand (Tuesday).
And there could be a much better trade account with the recent the surge in coal prices boosting the value of exports (along with higher iron ore prices).
The housing finance figures on Friday are expected to show a fall in the wake of the fall in building approvals.
Westpac holds its annual meeting in on Friday and this is likely to be some shareholder angst expressed about bank culture and some activities.
Reaction to the Italian Senate referendum will no doubt impact investment markets early in the week ahead.
Dr Oliver says that while confirmation of a “No” vote (as the polls are suggesting) “will add to uncertainty about the Italian government and its banks and maybe further fuel fears about a “break-up” of the Eurozone, a lot will have to occur before Italy leaves the Eurozone if at all."
"An early Italian election is unlikely to occur and even if there is the Five Star Movement is unlikely to win unless it softens its anti-Euro stance.
"Meanwhile, if the “Yes” vote wins Italy’s economic woes will remain. So the referendum is unlikely to settle anything either way.
“More broadly, the Eurozone is likely to continue to hang together and bouts of market turmoil driven by break-up fears should continue to be seen as buying opportunities,” Dr Oliver wrote.
After the Italian vote, the focus will be on the ECB meeting on Thursday night, our time which is expected to announce a six month extension of its quantitative easing program beyond its current expiry of March 2017 and some changes to enable it to buy a wider universe of bonds.
It is trying to avoid frightening markets with the US Fed expected to lift rates next week, which will lift volatility.
As well important economic data releases in the euro area include retail sales numbers and revised third quarter GDP figures.
In Britain the Supreme Court is scheduled to hear four days of evidence from December tonight, our time, until Thursday as the government tries to reverse last month’s landmark High Court ruling last month that dealt a blow to its Brexit plans.
The government is appealing a decision that found that it could not begin the Article 50 (Brexit) proceedings without a vote in parliament. The historic case will see all 11 judges hear the appeal. A decision is not expected until some time in January.
In the US, expect the non-manufacturing conditions survey results tonight, the trade balance Tuesday tomorrow night to weaken thanks to the rise in the dollar.
Quarterly figures from bulk retailer Costco, yoga wear maker, Luluemon and builder Toll Brothers, plus tax group, H&R Block are expected in what is a quiet week in the US.
And ahead of next week’s final Fed meeting of the year a trio of regional presidents are scheduled to speak tonight. New York Fed president William Dudley, Chicago Fed president Charles Evans and St. Louis Fed president James Bullard will discuss the outlook for the US economy at separate functions across the US.
Chinese October trade data on Thursday is expected to show continued softness in exports and imports and a further rise in both consumer and producer price inflation on Friday, which won’t be too shocking for markets.
And in late news, Alexander Van der Bellen, a Green politician who ran as an independent, has beaten a far right wing candidate to in a re-run of Austria’s presidential poll first held in May.
Mr Van der Bellen won 53.3% of the vote in the re-run of the first poll in May, while his far-right opponent, Norbert Hofer of the Freedom Party, won 46.7%. Mr Van der Bellen had scraped home in the first election by the smallest of margins (31,000 votes) and a series of legal challenges about postal vote problems saw Austrian’s constitutional court order a re-run which many commentators in Europe and elsewhere expected the far right Fascist to win.
The Freedom party was formed by former Austrian Nazis in the 1950’s and has used concerns about immigration and weak economic growth to promote themselves as the voice of the forgotten people of Austria. The win by Mr Van der Belen was greeted with relief by mainstream parties elsewhere in Europe and in Brussels.
