Australia: Inflation data front and centre

  • In the coming week, the September quarterly inflation reports dominate the economic calendar. Readings include consumer, producer and export/import prices.
  • But the week kicks-off on Monday when CommSec releases the State of States quarterly economic report card.
  • On Tuesday, ANZ and Roy Morgan jointly release the weekly consumer confidence index, which has hit 14-week highs.
  • Also on Tuesday, Commonwealth Bank (CBA) Group economists release the weekly credit and debit card spending data with a focus on the reopening of the NSW, Victorian and ACT economies.
  • On Wednesday, the Bureau of Statistics (ABS) publishes the September quarter Consumer Price Index (CPI). CBA Group economists expect that the ‘headline’ CPI rose by 0.8 per cent in the quarter. Higher prices for food, petrol, furnishings and household equipment, and alcohol and tobacco costs are all expected. But if the forecast is correct, the annual growth rate would ease from 12½-year highs of 3.8 per cent in the June quarter to 3 per cent in the September quarter.
  • RBA policymakers focus on the trimmed mean CPI (excludes volatile price components such as food and energy) as the key underlying measure of inflation. CBA Group economists expect the trimmed mean CPI to have lifted by 0.5 per cent in the quarter with the annual growth rate steady at around 1.8 per cent – still below the policymakers’ 2-3 per cent target range.
  • On Thursday, the ABS releases the International Trade Price Indexes (export and import prices) and regional population data.
  • On Friday, the ABS issues the Producer Price Indexes report (business inflation data). Labour shortages, supply chain disruptions and the energy price crunch will be in focus. And retail trade data is issued for September. Retail conditions in Delta lockdown-affected areas have been challenging for many Aussie businesses, with hospitality and tourism firms hit particularly hard.
  • Also on Friday, the RBA releases the private sector credit data (basically, ‘loans outstanding’) for September.

Overseas: US economic growth and housing data in focus

  • In the coming week, the focus is on the US economic growth (or GDP) figures and housing market data.
  • The week kicks-off in the US on Monday when the Dallas Federal Reserve manufacturing index for October is issued with the Chicago Federal Reserve national activity index for September.
  • On Tuesday, two measures of US house prices are released, both for the month of August. The first is from S&P CoreLogic Case-Shiller with the other produced by the Federal Housing Finance Agency (FHFA). The S&P CoreLogic Case-Shiller 20-city gauge rose by a record 19.9 per cent in July on a year ago.
  • Also on Tuesday, the Conference Board consumer confidence index is released with the Richmond Federal Reserve manufacturing index for October. And September new home sales figures and the regular weekly Johnson Redbook chain store sales data are also both issued. New US home sales could lift by 2.7 per cent to a 760,000 annualised rate in September as demand stabilises with builders making gradual headway on building backlogs.
  • On Wednesday in China, industrial profits data is scheduled for September.
  • On Wednesday in the US, weekly mortgage application data from the Mortgage Bankers Association is scheduled with the preliminary September durable goods orders and wholesale inventories reports. And the ‘advance’ goods trade balance for September is also due with a deficit of around US$87.3 billion expected by economists.
  • On Thursday, the ‘advance’ US economic growth (GDP) data for the September quarter is issued with pending home sales and the closely-followed weekly data on initial jobless claims (claims for unemployment benefits). Covid-19 Delta variant outbreaks and fading fiscal stimulus support is expected to slow consumer spending in the September quarter.  Economists estimate that GDP growth with slow from a 6.7 per cent annual rate in the June quarter to 3 per cent in the September quarter. That said, US economic growth is expected to be supported by excess household savings and inventory rebuilding by US firms in the December quarter.
  • Also on Thursday, pending home sales data and the US Kansas Federal Reserve factory index are both issued.
  • On Friday, personal income/spending data is released with the quarterly employment cost index (wages and benefits), Chicago purchasing managers’ index and the ‘final’ University of Michigan consumer sentiment survey.

US corporate reporting season: September quarter 2021

  • US companies scheduled to report this week include: Unisys, Kimberly-Clark, Facebook (Monday). 3M, Alphabet, Archer-Daniels-Midland, Eli Lilly, Lockheed Martin, Microsoft, Corning, Hasbro, Visa, Pinterest, Twitter, Texas Instruments (Tuesday). Century Aluminium, Apple, Bunge, Boeing, Ford,  Coca-Cola, Royal Caribbean Cruises, McDonald’s, Kraft Heinz, General Motors, Moelis, eBay (Wednesday). Under Armour, Amazon.com, Atlassian, Yum! Brands, Merck, Caterpillar, Starbucks, Mastercard (Thursday). Phillips 66, Cameco, Exxon Mobil, Colgate-Palmolive, Chevron, Weyerhaeuser, Fortis (Friday).

Originally published by Ryan Felsman, Senior Economist, CommSec