MNI GLOBAL WEEK AHEAD: All Eyes On Jackson Hole

Its a muted period for data in the week ahead, although the flash PMIs will be of interest. However, the week will end with a bang, as global central bankers gather in Jackson Hole, Wyoming, for the annual Fed symposium, which will be held face-to-face this year for the first time since 2019.

China LPR rate

China’s benchmark Loan Prime Rate (LPR) is likely to be pushed lower next Monday following the People’s Bank of China’s surprise cut to key policy rates on Aug. 15, as it seeks to boost credit demand and reverse the slowing post-lockdown economic recovery, according to analysts.

The PBOC unexpectedly trimmed 10 bps from rates across the curve this week, bringing the 7-day reverse repo rate to 2.0% and the 1-year medium-term lending facility (MLF) rate to 2.75%. The move was seen as a response to recent weak credit data as well as July’s softening production, consumption and investment figures.

The full look ahead is here

Flash EZ/UK PMIs

August PMIs will be the main euro area data focus. The EZ composite index is seen dipping further into contractionary territory, with manufacturing weakening and services dipping below the 'boom/bust line for the first time in almost 2-1/2 years. Th UK headline composite index is expected to fall, with both the manufacturing and services index coming under pressure.

• France Composite seen at 50.8 vs July's 51.7
• Germany Composite seen at 47.3 vs July's 48.1
• EZ Composite seen at 48.9 vs July's 49.9
• UK Composite seen at 51.2 vs July's 52.1
• US Composite in July was 47.7

Bank of Korea

The Bank of Korea looks set to raise its benchmark interest rate by 25 bps to 2.50% on August 25 as policymakers continue to prioritize fighting inflationary pressure, as the nation’s consumer price index accelerated to 6.3% y/y in July, the highest level since November 1998’s 6.8%.

MNI has heard thoughts in some places who argue the BOK could stand pat on monetary policy as upward pressure on inflation rate has peaked out and the BOK needs to focus on a weaker economy. Yet others in the financial markets point to the central bank taking the inflation data head on and perhaps hiking 50 bps for a second consecutive meeting.

Governor Rhee Chang-yong has said that the BOK would raise the rate gradually over time, hiking it by increments of a quarter percentage point, if inflation slows after peaking in the late third quarter or early fourth quarter. Another conundrum for the central bank is the decline in consumer sentiment, putting downward pressure on domestic demand, but driven by rising inflation.

Jackson Hole

• Thursday, August 25 – Saturday, August 27 – Federal Reserve's Jackson Hole Symposium
• Fed Chair Jay Powell is set to deliver a speech on the economic outlook Friday at 10 ET.
• His remarks come at a critical juncture for monetary policy and will be closely watched for clues to see how officials are plotting to downshift from the “unusual” pace of tightening in a way that retains inflation fighting credibility while maintaining prospects for a soft landing.
• Minutes of the July FOMC said officials judged it "likely would become appropriate at some point to slow the pace of policy rate increases."
• The topic of the annual academic conference is “Reassessing constraints on the economy and policy” and a detailed schedule is typically released the evening before.

Former KC Fed President Thomas Hoenig tells MNI he expects wide-ranging discussion of macroeconomic and policy constraints at next week's Annual Jackson Hole Symposium.

• Hoenig doesn't think Powell will show his cards on whether the Fed will hike 50 bps or 75 bps in September

Date	GMT/Local	Impact	Flag	Country	Event
22/08/2022	0115/0915			CN	PBOC LPR announcement
22/08/2022	1530/1130	*		US	US Treasury Auction Result for 13 Week Bill
22/08/2022	1530/1130	*		US	US Treasury Auction Result for 26 Week Bill
23/08/2022	2300/0900	***		AU	IHS Markit Flash Australia PMI
23/08/2022	0030/0930	**		JP	IHS Markit Flash Japan PMI
23/08/2022	0715/0915	**		FR	IHS Markit Services PMI (p)
23/08/2022	0715/0915	**		FR	IHS Markit Manufacturing PMI (p)
23/08/2022	0730/0930	**		DE	IHS Markit Services PMI (p)
23/08/2022	0730/0930	**		DE	IHS Markit Manufacturing PMI (p)
23/08/2022	0800/1000	**		EU	IHS Markit Services PMI (p)
23/08/2022	0800/1000	**		EU	IHS Markit Manufacturing PMI (p)
23/08/2022	0800/1000	**		EU	IHS Markit Composite PMI (p)
23/08/2022	0830/0930	***		UK	IHS Markit Manufacturing PMI (flash)
23/08/2022	0830/0930	***		UK	IHS Markit Services PMI (flash)
23/08/2022	0830/0930	***		UK	IHS Markit Composite PMI (flash)
23/08/2022	0900/1000	*		UK	Index Linked Gilt Outright Auction Result
23/08/2022	1000/1100	**		UK	CBI Industrial Trends
23/08/2022	1100/1300			EU	ECB Panetta at ECB Policy Panel at EEA Annual Congress
23/08/2022	1230/0830	**		US	Philadelphia Fed Nonmanufacturing Index
23/08/2022	1255/0855	**		US	Redbook Retail Sales Index
23/08/2022	1345/0945	***		US	IHS Markit Manufacturing Index (flash)
23/08/2022	1345/0945	***		US	IHS Markit Services Index (flash)
23/08/2022	1400/1600	**		EU	Consumer Confidence Indicator (p)
23/08/2022	1400/1000	***		US	New Home Sales
23/08/2022	1400/1000	**		US	Richmond Fed Survey
23/08/2022	1530/1130	*		US	US Treasury Auction Result for Cash Management Bill
23/08/2022	1700/1300	*		US	US Treasury Auction Result for 2 Year Note
23/08/2022	2300/1900			US	Minneapolis Fed's Neel Kashkari
24/08/2022	1100/0700	**		US	MBA Weekly Applications Index
24/08/2022	1230/0830	*		CA	Quarterly financial statistics for enterprises
24/08/2022	1230/0830	**		US	durable goods new orders
24/08/2022	1400/1000	**		US	NAR pending home sales
24/08/2022	1430/1030	**		US	DOE weekly crude oil stocks
24/08/2022	1530/1130	**		US	US Treasury Auction Result for 2 Year Floating Rate Note
24/08/2022	1700/1300	*		US	US Treasury Auction Result for 5 Year Note
25/08/2022	0600/0800	***		DE	GDP (f)
25/08/2022	0645/0845	**		FR	Manufacturing Sentiment
25/08/2022	0700/0900	**		ES	PPI
25/08/2022	0800/1000	***		DE	IFO Business Climate Index
25/08/2022	1000/1100	**		UK	CBI Distributive Trades
25/08/2022	1130/1330			EU	ECB publishes accounts of July 20-21 meet
25/08/2022	1230/0830	*		CA	Payroll employment
25/08/2022	1230/0830	**		US	Jobless Claims
25/08/2022	1230/0830	***		US	GDP (2nd)
25/08/2022	1230/0830	**		US	WASDE Weekly Import/Export
25/08/2022	1300/1500	**		BE	BNB Business Sentiment
25/08/2022	1430/1030	**		US	Natural Gas Stocks
25/08/2022	1700/1300	**		US	US Treasury Auction Result for 7 Year Note
26/08/2022	0600/0800	*		DE	GFK Consumer Climate
26/08/2022	0600/0800	**		SE	Unemployment
26/08/2022	0600/0800	**		SE	PPI
26/08/2022	0645/0845	**		FR	Consumer Sentiment
26/08/2022	0800/1000	**		IT	ISTAT Business Confidence
26/08/2022	0800/1000	**		IT	ISTAT Consumer Confidence
26/08/2022	0800/1000	**		EU	M3
26/08/2022	1230/0830	**		US	Personal Income and Consumption
26/08/2022	1230/0830	**		US	Advance Trade, Advance Business Inventories
26/08/2022	1400/1000	***		US	Final Michigan Sentiment Index
26/08/2022	1400/1000			US	Fed Chair Jerome Powell at Jackson Hole
26/08/2022	1500/1100			CA	Finance Dept monthly Fiscal Monitor (expected)