Debate is raging about how to deal with the slowdown in Australia’s economic growth, with leading economist Ross Garnaut chiming in, calling for a rate cut.
The RBA has made it clear that is not about to happen and Tuesday will give us the best read on what is really going on in the economy with the release of the NAB Business survey. Conditions and confidence are important but we’ll be watching the sub-indices which cover trading, profitability, forward orders and employment.
Wednesday sees the release of the monthly Westpac consumer sentiment number, which is important given the 6.4% unemployment outcome last month was only partly caught by the previous survey.
On Thursday we get the latest employment data in Australia, with the market looking for a rise of 15,000 and an unemployment rate of 6.3%.
Parliament is not sitting this week, so we won’t have the excitement of deals between the Government and the PUP senators. But expect the Government to continue to prosecute its budget.
From a market point of view, US non-farm payrolls were weaker than expected on Friday and this, along with Mario Draghi’s move toward quantitative easing, sets up markets both in Australia and globally for a very interesting week.
Can the S&P continue to make new highs and will the Aussie stock market continue to under-perform as iron ore falls weigh on our miners?
There is plenty of data offshore as well, including Chinese and German trade, British Manufacturing, UK GDP estimate is out and Chinese CPI will be released. Bank of England governor Mark Carney speaks, our cousins in New Zealand have an RBNZ decision and in the US, retail sales close out the week.
And don’t forget the Scottish referendum on the 18th as we get closer to the date the pound will become increasingly vulnerable if the ‘Yes’ vote continues to improve.
Here is Westpac’s excellent diary of all the data and events that matter.