Key data in Australia this week will be led by the RBA, with the bank set to make its November interest rate announcement on Tuesday afternoon, 30 minutes before the Melbourne Cup sets off. That will be followed by the central bank’s quarterly growth outlook in the Statement on Monetary Policy on Friday.
Internationally, data from China later in the week on inflation and credit growth for October will provide the first update on how China’s economy is tracking in Q4. It’s a quieter week of key data ahead in the US, UK and Europe.
Monthly employment figures in the US on Friday night showed a gain of 261,000 jobs in October. The result was solid but slightly short of expectations, while ISM data showed US non-manufacturing activity hit a 12-year high.
The US dollar index closed Friday’s session higher but was little changed for the week. With the US Fed on track to raise rates again in December, shorter term 2-year bond yields edged higher while benchmark 10-year US treasury yields dipped slightly to end the week at 2.33%.
US stocks closed at a fresh record high, helped by gains in Apple which crushed earnings forecasts after markets closed on Thursday. Apple shares rose by 2.6% in Friday trade.
The Australian dollar was sold off across the board in overnight markets, after falling during Asian trade on Friday in the wake of soft retail sales data. It closed 0.80% lower against the greenback at 0.7651 US cents.
The RBA will make its November interest rate announcement on Tuesday at 2:30pm AEST, with the pretty much certain to once again keep the benchmark cash rate on hold at 1.5% — the same level it has been since August last year.
Recent statements from the RBA suggest the bank remains optimistic about Australia’s economy, although since the October statement some key data misses have seen market pricing for a rise in interest rates extended to the second half of next year.
On Thursday, the ABS will release September housing finance data following a surprising result in August, which showed home loan lending hit a new record high including a notable rise in investor loans.
On Friday, the RBA’s quarterly Statement of Montary Policy (SoMP) will provide an update on its projections for inflation, GDP and the unemployment rate.
The previous SoMP in August saw the bank downgrade its near-term growth outlook, while maintaining its forecast that the economy will return to 3-4% growth by 2019.
Here’s this week’s domestic calendar (via ANZ):
Looking abroad, the Bank of Japan has the minutes from its September meeting on Monday, followed by a speech from Bank of Japan Governor Kuroda.
Then on Monday night, William Dudley — a voting committee member of the US Fed — will give a speech in New York called “Lessons from the Financial Crisis”.
On Tuesday, Japan has annual wage data for September, with the market forecasting a rise in wages of 0.5%.
On Thursday morning (7:00am AEST), the Royal Bank of New Zealand will make its November interest rate announcement, with no changes expected to the current benchmark cash rate of 1.75%.
Also on Thursday, China has October inflation data, with the current forecast for annual growth of 1.7%.
That will be followed by Chinese aggregate financing data on Friday, which is expected to show that credit growth slowed slightly in October but remains elevated.
This week’s schedule of the major international data releases is below (also via ANZ):
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