After a tumultuous trading week, stocks closed on a much firmer footing on Friday, no doubt in part because Bank of England chief economist Andrew Haldane joined noted Fed hawk James Bullard in suggesting that interest rates might stay lower for longer.
Their comments are recognition of a slowing global economy and low inflation, which gives central banks more room than they thought they had, and is also the salve traders, fearful of an October crash, needed.
The ANZ released data on Friday which highlighted the tension in markets. For the second week in a row emerging markets saw fund flows exiting both bond and equity markets as traders head back to the safety of bigger markets – even as they fall.
Traders head into this week with frayed nerves and as a result, usually less important data releases in the second half of the month will have an elevated importance.
Of note will be the flash HSBC manufacturing PMI for China on Thursday, along with similar releases for Europe.
Before that, in Australia we’ll hear from a raft of RBA speakers, including Assistant Governor Chris Kent on Monday, Deputy Governor Phil Lowe on Tuesday and Governor Glenn Stevens on Thursday morning.
Datawise the RBA minutes will be released at 11.30 on Tuesday, Q3 CPI is on Wednesday, and a low number will heighten talk of a potential – probably increasingly necessary – rate cut from the RBA.
The larger, quarterly NAB business survey is out Thursday.
The House Of Representatives is sitting in Canberra this week and while the legislative agenda isn’t particulalry full there is likely to be plenty of focus on ISIS, Ebola and in particular Julie Bishop’s 25 minute discussion with the Russian president.
Of course there will be lots of discussion about the Wallabies valiant, if unsuccessful, effort on Saturday night.
Here is Westpac’s excellent summary of all the important data in the week ahead.
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