After a softer-than-expected US inflation release has reignited bets that the Federal Reserve would slow the pace of its interest-rate hikes, investors will be looking for further signs pointing to slow down in inflationary pressures. As such, in the spotlight will be the producer prices index, exports and imports prices and retail sales. The PPI is seen rising 0.5% month-on-month, resulting in the annual rate of inflation slowing to 8.3% from 8.5% while retail sales are expected to rise 0.9% month-on-month gain, suggesting consumers are still spending despite higher prices. Meanwhile, US building permits, housing starts, and existing home sales will offer further clues on the impact of rising rates on economic activity. Furthermore, a slew of earnings results, particularly those from big retailers, including Home Depot, Walmart, and Target, will help investors gauge the health of the world's largest economy. Elsewhere in America, Canada will release inflation and housing starts data.
In the United Kingdom, all eyes turn to new UK Chancellor Jeremy Hunt’s Autumn budget due Thursday, which will likely point to sharp spending cuts and tax increases to fill the £50 billion fiscal hole in the UK public finances. Aside from the budget statement, Britain’s economic calendar is packed with important data, including key reports on inflation, unemployment, and retail sales. UK consumer price data for October is expected to show annual inflation accelerating to a new 40-year high of 10.6% from 10.1% in September as regulated energy prices rose, despite costly subsidies to limit the increase.
Elsewhere in Europe, investors will keep an eye on the Germany Zew Economic Sentiment Index and preliminary Q3 GDP data for several countries, including the Netherlands, Poland and Russia. Also, Eurostat will release the final estimate of Q3 GDP and inflation rate for Euro Zone as well as balance of trade, industrial and construction output; and wholesale prices.
In Asia, Japan is headlined by preliminary third-quarter GDP figures, followed by the inflation rate and balance of trade for October. The Japanese economy is expected to have grown 0.3% in Q3, extending three straight quarters of expansion. In the meantime, China will release industrial production, retail sales, housing price growth, and fixed investment data for October. In India, October’s inflation print is expected to show that retail price growth slowed to edge closer to the RBI’s upper target of 6%, while the Ministry of Commerce will release fresh trade data. Elsewhere, investors await interest rate decisions by monetary authorities in Indonesia and the Philippines. In Australia, minutes from the RBA’s November meeting should give more insights on the course of monetary policy after the central bank delivered lower-than-expected 25bps rate hike. Other key releases include labor data for October and wage data for Q3.