Next week’s domestic data docket is relatively sparse in terms of Australian data.
On Wednesday the second quarter Construction Work Done data will be of interest as it measures the value of all construction completed in Australia during the previous month. Officially referred to as Building Activity, this figure is used to track developments in the construction sector. Because the construction sector is a leading indicator of economic output and the rest of the housing market, a consistent decline in this number (particularly in conjunction with a decline in new building permits or housing financing) can act as a precursor to contraction in the economy as a whole.
Wednesday’s Westpac-MNI Consumer Sentiment report may also be of interest to those invested in the antipodean currency, but is unlikely to influence the market to any great extent.
On Thursday the HIA New Home Sales may prove to be significant in terms of the strength of the ‘Aussie’ (AUD). An increase in home sales suggests a growing housing market which tends to promote the rest of the economy.
Private Capital Expenditure may also be of interest to those invested in the ‘Aussie’ but it won’t hold much weight in terms of market movement.
AUD Forecast
On September 2nd there will be a Reserve Bank of Australia board meeting which could provide key insight into Australian economic development and the timing of an interest rate hike.
On September 3rd Reserve Bank of Australia Governor Glenn Stevens addresses the Committee for Economic Development of Australia. The theme of the meeting is likely to be an extension of Steven’s most recent speech in which he called for hawkish businessmen to promote the Australian economy.
The Canadian domestic data calendar is very light next week, with nothing due for release until Thursday.
Thursday’s second quarter Current Account data will be of interest to those invested in the ‘Loonie’ (CAD). The Current Account gives a detailed breakdown of how the country intermingles with the rest of the global economy on a practical, non-investment basis. The Current Account tracks the trade balance (exports and imports for goods and services), income payments (such as interest, dividends and salaries) and unilateral transfers (aid, taxes, and one-way gifts). A positive value (current account surplus) indicates that the flow of capital from these components into Canada exceeds capital leaving the country.
Average Weekly Earnings data, whilst not particularly influential on the market as a whole, gives valuable insight into the correlation between earnings and inflation. A miscorrelation, as seen with the Pound Sterling recently, can cause the currency to extend losses against all of its major peers.
Friday will be highly influential in terms of Canadian domestic data. The Gross Domestic Product data will be of high significance as a primary indicator of Canada’s overall economic growth.
The Industrial Product Price report and the Raw Materials Price Index will have an influence economically, but is unlikely to register any notable movement when accompanied by the GDP data which has much more weighting.
CAD Forecast
On September 3rd the Bank of Canada will address journalists on their interest rate outlook, followed by a press release on the same subject. Expect volatility around this time as speculation grows as to what their outlook will be.
Yen movement may be limited next week as Japan doesn’t have any domestic data releases scheduled for publication until Thursday, with the exception of Tuesday’s Corporate Service Price report which doesn’t have much weighting on Yen movement.
On Thursday Buying Foreign Bonds and Buying Foreign Stocks data will be of interest to those backing the Yen.
Friday will be a pivotal day for the Japanese economy. There will be a high number of domestic data publications of varying importance. Jobless Rate will be influential as a lower jobless rate translates into more income-earning workers and greater consumption which, in turn, accelerates economic growth.
The year-on-year National Consumer Price Index (CPI) is highly likely to provoke Yen movement. As the most important indicator of inflation, CPI figures are closely followed by the Bank of Japan (BOJ). Rising Consumer Prices may prompt the BOJ to raise interest rates in order to manage inflation and slow economic growth.
Those backing the Yen will also want to look out for Household Spending, National Consumer Price Ex-Fresh Food, Large Retailers’ Sales, Industrial Production and Housing Starts. Of these pay close attention to Industrial Production as it is considered a reliable leading indicator that conveys information about the overall health of the Japanese economy.
JPY Forecast
September 4th will be important as the Bank of Japan will give a statement on Monetary Policy. September 9th is also likely to be influential, in terms of economic standing and Yen movement, as the minutes from the recent Monetary Policy meeting will be published.
Comments are closed.