FYI | Jun 12 2007
By Greg Peel
It’s a fairly quiet week in Australia ahead as far as economic data are concerned. Today we get the NAB monthly business survey for May, and tomorrow the Westpac-Melbourne Institute consumer sentiment index for May. This is followed on Thursday by the W-MI consumer inflation expectation measure for June, which will be a fitting accompaniment for RBA governor Glenn Stevens’ speech on the state of the Australian economy. This will be the first time Stevens has shared his thoughts since February.
It’s a different story in the US where quite a barrage of data is due. Tomorrow night we learn US business inventories for April, and import prices and retail sales for May, along with the Fed “beige book” which provides clues to economic performance. With the economy sorted, attention then turns to inflation on Thursday with the release of the May PPI, followed by the May CPI on Friday.
There will be a lot to absorb over the weekend, as Friday in the US also sees the Empire manufacturing survey for and the Uni of Michigan confidence measure for June, as well as industrial production for May and capacity utilisation for June. We also learn April long term Treasury International Capital (TIC) flows – the net amount of foreign money flowing in or out – and the accompanying first quarter current account figure. Bond markets will be closely watching those last two. To top it all off, Fed governor Ben Bernanke will speak to a credit conference on Friday.
There’s more CPI action across the globe this month as China reports today and the UK tonight, followed by Europe on Thursday. If Friday’s action in the US isn’t enough, the Bank of Japan will bring down its rate decision as well beforehand. A rise in rates would not surprise and would put added pressure on risk premiums already under threat from rising US bond yields. This will be a closely watched release.
There’s little action planned ahead this week in local stocks, other than analysts trotting out to the top end on Thursday to visit ERA’s (ERA) Ranger uranium mine and probably try to steal any classified information lying around regarding ERA’s legacy contract obligations.
With regards to overseas market action over the long weekend, see our accompanying Wall Street report this morning.