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Asia-Pacific Week Ahead

     The highlight of the week will release of the Bank of Japan's Tankan
quarterly business survey, which is expected to show sentiment among many
business sectors improved from three months ago, thanks to firmer global demand
and resilient domestic consumption. The market will watch closely business'
capital inflation plans and inflation expectations.
     Bank of Japan
     Monday, 8:50 am JST (2350 GMT Sunday): The BOJ releases its quarterly
Tankan business sentiment survey for September. The median forecasts: major
manufacturer diffusion index +18 vs. +17 in June; major non-manufacturer DI +23
vs. +23 in June; small manufacturer DI +8 vs. +7 in June and small
non-manufacturer DI +7 vs. +7 in June. Capital investment plans by major firms
+8.4% vs. 8.0% in June.
     Tuesday, 8:50 am JST (2350 GMT Monday): The BOJ releases inflation
     outlook in September Tankan. In the June survey, companies on average
     revised up their expectations for the consumer price index for one and
     three years ahead from the previous Tankan survey, but left their inflation
outlook for five years ahead unchanged from March.
     Friday, 1:30 pm JST (0430 GMT): The BOJ release its quarterly survey on
consumer sentiment, inflation outlook.
     Tuesday, 2 pm JST (0500 GMT): The Cabinet Office releases the outcome of
the September Consumer Confidence Survey. In August, the confidence index
slipped 0.5 point to 43.3 on a seasonally adjusted basis, posting the first
month-on-month drop in two months, hit by bad weather and heightened tensions
between North Korea and the U.S.
     Friday, 9 am JST (0000 GMT): The Ministry of Health, Labour and Welfare
releases preliminary August wages. In revised data, July total monthly average
cash earning per regular employee fell 0.6% on year for the first drop in 14
months after rising 0.4% in June, due to a slump in summer bonuses. In real
terms, average wages fell 1.1% on year for the second straight drop. Base wages
rose 0.5% on year, showing the gradual uptrend. Overtime pay rose 0.2% but
bonuses and other special pay fell 3.1%.
     Japanese Government Bonds
     Japanese government bond yields may fall following the recent rise if the
yen appreciates. The 10-year JGB yield is expected to move between 0.025% and
0.065% this week against the bank's target of around zero. It rose to 0.075% on
Thursday for the highest level since Aug. 1 after falling to -0.010% on Sept. 8,
the lowest since Nov. 15, 2016.
     Tuesday: The Ministry of Finance to auction Y2.3 trillion of 10-year bonds.
     Wednesday: The MOF to auction Y2.3 trillion of six-month Treasury.
     BOJ outright purchase operations for JGBs with remaining life of 1-3,
     3-5, 5-10 years expected.
     Thursday: The MOF to auction Y400 billion of 10-year inflation-indexed
bonds and Y4.4 trillion of three-month Treasury discount bills.
     Friday: BOJ outright purchase operations for JGBs with remaining life of
5-10, 10-25 and more than 25 years expected.
     It's a short week due to the Labor Day holiday on Monday, with the
highlight the RBA's monthly cash rate decision on Tuesday. The Labor Day is
observed in three states including New South Wales, so there are still the usual
first day of the month releases.
     Tuesday, 2:30 pm local (0330 GMT), the RBA publishes the cash rate
decision, where the unanimous view of both the market and economists is for the
RBA to leave the rate on hold at 1.5%. This is the first time in a long time
that all economists are unanimous in their view that the 1.5% cash rate will be
the low for this cycle. Many expect the rate hike process to begin in 2018, with
some expecting the first hike as early as Q1 next year while a few expect the
cash rate to stay at 1.5% for longer.
     Monday, 9:30 am local (2230 GMT Sunday) AI Group will release its
performance of manufacturing index, which is expected to expand for the 12th
straight month, though the pace may slow from August's record 59.8 points. At
10:00 am local (2300 GMT Sunday) CoreLogic publishes its house price index,
which is expected to show a tiny m/m rise in September compared with a flat
outcome in August.
     Tuesday, 9:30 am local (2230 GMT Monday) the ANZ-Roy Morgan's weekly
consumer confidence index will be released. At 11:30 am local (0030 GMT) the ABS
will publish dwelling approvals for August, where MNI median forecast is for a
1.0% m/m increase after a 1.7% fall in July. At the same time is ANZ will
publish its Job Ads index for September, with an expectation for a smaller
increase following a 2.0% m/m rise in August.
     Wednesday, 9:30 am local (2230 GMT Tuesday) AI Group publishes its
performance of services index for September, which is expected to continue to
show expansion but the focus will be on retail trade which has contracted since
     Thursday, 11:30 am local (0030 GMT) the ABS publishes retail sales for
August, with MNI survey median forecast for 0.2% m/m rise compared with flat
outcome in July. At the same time, the ABS releases the international trade
balance for August, with the expectation is for a surplus of A$800 million
compared with a surplus of A$460 million in July.
     Friday, 9:30 am local (2230 GMT Thursday) the AI Group publishes its
performance of construction index, which is expected to continue to show
expansion. The focus will be on commercial (50.2 in August) and (44.7 in August)
apartment construction activity.
     It's a quiet week with no major economic data releases due, so the focus
will be on political developments as the remaining votes for the general
elections are counted.
     No major data or event is due.
     Chinese mainland markets will be closed all week for the National
Day/Autumn Festival holiday. They will reopen on Monday, Oct. 9.
     Saturday, Oct. 7, time uncertain: Chinese foreign exchange reserves data
for September will be released. In August, reserves rose $10.81 billion to
$3.0915 trillion, the sixth increase in a row to the highest level since last
October, although the increase in August was less than the $23.93 billion rise
in July.
--MNI BEIJING Bureau; +1 202-371-2121; email:
[TOPICS: M$A$$$,M$J$$$,M$L$$$,M$N$$$,M$Q$$$]

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