FYI | Sep 02 2007
By Greg Peel
President Bush arrives in Sydney on Tuesday and will stay until Saturday providing a week of disruption in the Sydney CBD. The meeting culminates on Friday as all the leaders gather inside the Berlin Wall and the city is declared to be on some sort of public holiday which has never really been fully defined. There is no reason why APEC should impede the usual course of business as thousands of financial industry employees pass through checkpoints each morning, although Friday may just be a little quiet.
The US starts the week with the Labor Day public holiday on Monday. Any economic data released from here until at least the next rate decision on September 18 will now be assessed for its “timeliness” given Fed chairman Bernanke stated on Friday that “economic data bearing on past months or quarters may be less useful than usual for our forecasts of economic activity and inflation” because of the ongoing credit crisis.
Tuesday sees the release if the ISM manufacturing index and vehicle sales for August, which are relatively timely. Wednesday brings July pending home sales, which are a bit stale, and the Fed beige book which has been superseded by Friday’s statements. Thursday brings two old hat second quarter figures – non-farm productivity and unit labour costs – along with July building permits and ISM non-manufacturing index and Ivey purchasing managers’ index for August. Friday sees July wholesale inventories, along with the reasonably timely non-farm payrolls and unemployment figures for August. The unemployment numbers are yet to be impacted by the growing number of lay-offs in the mortgage industry, and it remains to be seen just how many victims hit the dole queue.
The eyes of the world will be on Brussels and London on Thursday as both the European Central Bank and Bank of England announce rate decisions. Whereas both were widely expected to raise rates at one stage, they are now unlikely to do so. Jean-Claude Trichet has already hinted as much.
It ‘s also rate decision week in Australia. While recent economic data have all pointed to an economy pumping along, the RBA is not expected to move on Wednesday given the August rise and the current state of the global credit market.
It is, nevertheless, an important week for economic data downunder. We learn second quarter company profits and inventories on Monday along with July building approvals. Wednesday’s rate decision comes with second quarter GDP and the all-important employment/unemployment numbers are released on Thursday.
The Australian results season is effectively over, with only a trickle of final or interim results left to be released over the next couple of weeks. We will thus now enter a research dead zone, as stock analysts across the country take their customary post-season holidays, having burnt the candle at both ends for about a month.
