MNI Global Week Ahead Aug 30 – Sept 3

Key Things to Watch:

• Tuesday, August 31 – Eurozone Inflation
  • August flash inflation is due Tuesday at 1000BST. Having backed away in June, headline inflation again nudged higher in July, sitting at 2.2% y/y, above the ECB's new target rate of 2%. Prices are set to push higher again in August, with expectations for prices to rise 0.2% m/m, but jumping to 2.7% y/y.
  • Core inflation is expected to leap from 0.7% y/y in July to 1.5% in August.
  • With the data coming just a week ahead of the ECB's September policy meeting, it will make for an uncomfortable press conference for President Christine Lagarde, even though she will likely commit to looking through it.

• Wednesday, September 1 – ISM Manufacturing
  • U.S. manufacturing activity likely dipped in July, with Bloomberg forecasting a slight decline in the ISM Manufacturing Index to 58.5 from 59.5 in June. That would still signal expansion as the index remains above 50.
  • Regional manufacturing data suggests business conditions worsened through the month and supply chain bottlenecks persisted, hampering production.

• Friday, September 3 – U.S. Nonfarm Payrolls
  • Hiring faltered through August as the spread of the Delta variant of Covid-19 put some downward pressure on business confidence. Employers added 750,000 jobs through the month, according to Bloomberg, down from 943,000 through July.
  • Still, higher wages and more aggressive recruiting will likely fuel further job gains, mostly in the services sector.
• The unemployment rate is expected to fall to 5.2% from 5.4% in July, according to Bloomberg, and hourly earnings should decline slightly to 0.3% from 0.4% in July.