Next Week At A Glance

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 Tonight in the US sees the release of the US jobs numbers for January, arguably the most important economic data release of any given month at present.

Hope had been building that the figure would show an increase in jobs this month, suggesting the long trend of American job losses would be broken. Yet despite the improvement, economists still expected the rate of unemployment as a percentage would rise from 10.0% in December to 10.1% in January. But on Wednesday, the preliminary private ADP calculation of private sector job losses was disappointing. And last night weekly new jobless claims showed an increase when a decrease is expected. In short, the market is no longer as confident of a positive result tonight.

Which in the context of current global malaise, is not encouraging. While concerns linger over the extent China will reign in its economic growth through tightening measures, and relationships between the US and China sour over arms sales to Taiwan, last night’s big sell-off in the European and US markets was ostensibly to do with growing fears over European sovereign debt defaults. (See Europe On The Brink ).

To that end, and once we have learned tonight’s US jobs figure, next week’s economic data releases are unlikely to have much impact on the unfolding macro story.

It’s a relatively quiet week in the US, although wholesale and business inventory numbers will be closely watched. On Wednesday the US learns its monthly trade balance and monthly fiscal budget disaster, which is currently very much in focus. January retail sales and the first Michigan Uni consumer sentiment reading of the month will also draw attention.

Next week the US Treasury will auction US$40bn of three-year notes, US$25bn of ten-year notes and US$16bn of thirty-year bonds as part of its eternal program to fund its deficit. Late last year interest for such issues from foreign central banks was a little wobbly as the US dollar quietly retreated. By contrast, this week’s issues are likely to be better received given sovereign debt fears across the pond.

It’s a quiet week in Australia too, but there some important releases. We’ve had our “on hold” RBA rate decision for the month, but as to whether the RBA restarts the tightening phase in March will come down to data flow from here. Wednesday brings home loan and investment lending data, and Thursday Australia’s jobs numbers. Big improvements in any or all will elevate the chance of a March hike.

In the context of China trying to pull the reins on bank lending, next week sees releases of Chinese money supply, new loans and trade balance. The highlight in Europe outside of Club Med default concerns will be the first release of the EU fourth quarter GDP on Friday.

Locally, we’re beginning to get into the earnings season swing. Highlights next week include interim reports from BHP Billiton ((BHP)), Rio Tinto ((RIO)), Commonwealth Bank ((CBA)) and Telstra ((TLS)).

For a more comprehensive preview of next week’s events, please refer to “The Week Ahead”, published each Monday morning. For all economic data release dates, earnings release dates and other relevant information, please refer to the FNArena Calendar.

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