Australia: Summer sizzler

  • The year may be coming to an end but there is no end to the amount of insightful data to assist investors with their investment and budget planning decisions. And the Reserve Bank Board meets for the final time in 2021.
  • The week kicks-off on Monday with job advertisements data from the ANZ and the inflation gauge from the Melbourne Institute for November. Job ads jumped 6.2 per cent in October.
  • On Tuesday ANZ and Roy Morgan jointly release the weekly consumer confidence index. And Commonwealth Bank (CBA) Group economists are scheduled to release the Household Spending Intentions Index (HSI) for November.
  • Also on Tuesday AiGroup issues the Performance of Services index while the Reserve Bank issues data on credit and debit card lending. And the Bureau of Statistics (ABS) publishes home prices data for the September quarter: “Residential Property Price Indexes.” The data includes estimates on the number of houses, enabling economists to track trends in the average number of people per home.
  • And to round out a busy Tuesday, the Reserve Bank Board meet at 2.30pm AEDT in the final ‘get-together’ of 2021. No changes in policy settings are expected after policymakers announced in November that they would scrap the target of 0.1 per cent for the April 2024 Australian Government bond.
  • On Wednesday, the Bureau of Statistics (ABS) releases the “Labour Account Australia” report, featuring key insights on the number of people working secondary or multiple jobs. And the National Skills Commission issues job vacancies for November.
  • On Thursday, Reserve Bank Governor Philip Lowe speaks at the Payments Summit at 9am AEDT. The Reserve Bank also issues its quarterly Bulletin, which includes topical economic insights.
  • Also on Thursday, the ABS issues weekly payroll jobs and wages data for the fortnight ended November 13.
  • And on Friday, the ABS publishes the monthly business turnover indicator for

Overseas: Inflation in focus

  • In the coming week, inflation reports in both China and the US loom large.
  • The week begins on Tuesday in China with international trade data scheduled. There was another upside surprise in export growth in October, showing external demand continues to buttress the under-pressure economy as supply-chain constraints persist. Exports are expected to lift around 26 per cent in November on a year ago.
  • On Tuesday in the US, data on nonfarm productivity, unit labour costs, international trade and consumer credit are issued with weekly Johnson Redbook chain store sales report and the IBD/TIPP economic optimism index.
  • The US trade deficit widened to a record in September with the gap in trade of goods and services growing by 11.2 per cent to US$80.9 billion. Net exports subtracted 1.14 percentage points from economic growth, as measured by GDP, in the September quarter. A trade deficit of around US$66.7 billion is expected in October.
  • On Wednesday, the Small Business Optimism index from the National Federation of Independent Business (NFIB) is issued with the weekly mortgage applications data from the Mortgage Bankers Association (MBA).
  • Optimism among US small businesses fell to a 7-month low in October with inflationary pressures continuing to build. A net 53 per cent of business owners reported raising prices – the most since 1986 – with a record share planning to raise wages amid labour shortages. The index may have edged lower from 98.2 to 98 in November.
  • Also on Wednesday, the Job Openings and Labor Turnover Survey (JOLTS) from the US Labor Department will be a key focus of investors when released. A record 4.4 million Americans quit their jobs in September with the number of available positions easing further from all-time highs of 11.1 million in July to 10.4 million.
  • On Thursday in China, both consumer and producer prices data are scheduled. Factory-gate inflation surged by 13.5 per cent in October on a year ago – the most since July 1995 – spurred by surging commodity prices. The easing of food price deflation pushed consumer prices up by 1.5 per cent on a year ago.
  • On Thursday in the US, the weekly claims for unemployment benefits (initial jobless claims) will be scanned for a tightening of the labour market after claims dropped to just 199,000 prior to Thanksgiving – the fewest since 1969. And wholesale inventories data also features with stocks tipped to lift by 2.2 per cent in October.
  • On Friday, the November inflation report will capture the attention of investors ahead of the US Federal Reserve mid-December policy meeting. In October, US consumer prices rose by 6.2 per cent on the year – the strongest pace in 31 years. And the core measure (excludes food and energy) lifted by 4.6 per cent on the year. Economists tip consumer prices to jump 0.7 per cent in November with core prices 0.5 per cent higher.
  • Also on Friday, the November budget statement and the University of Michigan consumer sentiment index for December are both issued. Confidence fell to a decade low in November as higher prices continued to erode consumer spending power.

Published by Ryan Felsman, Senior Economist, CommSec