Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Preliminary December Michigan Sentiment index on Friday the stand out. In the coming week for data. The focus will largely turn to the RBA and BOC interest rate decisions.
MONDAY
Final Services PMIs: First prints for Italy and Spain Services PMIs will likely show around one-point upticks, lifting Spain back into expansive territory. New orders have continued to fall (albeit less steeply) and service-sector downturns are generally easing across the bloc with outlooks appearing to be beyond the worst.
Eurozone Retail Trade: A weaker October print is anticipated for euro area retail sales. Consensus is looking for a -1.9% m/m (vs Sep +0.4%) and +3.0% y/y (vs Sep -0.6%) contraction. This follows a -2.8% m/m contraction posted by Germany for October.
Consumer Spending on both goods and services provided a vital boost to Q3 GDP, elevating growth to remain modestly expansive at +0.2% q/q. Nevertheless, a weaker October retail print could be the kickoff of muted holiday-season spending, which would signal a drag on growth into year-end.
US ISM Services: The ISM services index is expected to soften by one point to 53.4 in November, outpacing the weaker-than-anticipated ISM Manufacturing print of 49.0 released on Thursday. The Chicago PMI (produced with MNI) recorded a significant November plunge, flagging recession. As around 20% of the index represents service-based industry, the details in the Chicago data imply a more substantial ISM services slide for November.
Despite high inflation and even throughout the last winter Omicron wave, the US ISM services index has remained buoyant. Though as global demand winds down and consumers reconcile with substantially lower real income, eyes will be on the index to signal the onset of a more marked downturn.
US Factory/Durable Goods Orders: US durable goods orders are likely to be confirmed at a robust +1.0% m/m in October, whilst initial factory goods orders are projected to follow suit and improve to +0.7% m/m from +0.3% m/m in September. Ex-transport outlooks are more subdued, following the -0.1% m/m contraction in September.
TUESDAY
Australia Interest Rate Decision: The RBA is expected to lift rates by 25bp on Tuesday, but the focus will be on any tweaks to forward guidance that may signal the timing of a pause in its tightening campaign next year. A hike to 3.1% represents cumulative tightening of 300bps since May, with the impact evident in falling house prices and depressed consumer sentiment. See our RBA watch here.
Germany Factory Orders: A modest recovery to +0.5% m/m is anticipated for October factory orders in Germany, following the -4.0% m/m plunge in September. Capital and immediate goods will be closely watched to gauge investment outlooks ahead of a (mild) winter recession and high energy prices. Consumer goods should weaken from their strong September expansion, to come in line with falling retail demand.
US Trade Balance: The US trade deficit is seen depending by around 4bln to USD -77bln in October, after widening for the first time in six months in September. This follows the record deficit of USD -107bln in March. Lucrative US oil exports had recently underpinned improvements, yet muted global demand and the strong dollar are weakening the US export industry.
WEDNESDAY
Germany Industrial Production: Following Tuesday’s factory order data, German industrial production is projected to record a shaky start to Q4. October IP is forecast to contract by -0.6% m/m and -0.7% y/y, following a relatively robust September print. Supply-chains easing is providing support to auto production, however, energy-intensive production remains severely hampered by high energy prices. Survey data continues to signal that the German economy teeters on the edge of a recession.
Italy Retail Sales: Slowing retail sales are expected for Italy in October, after having expanded by +0.5% m/m in September.
Eurozone Final GDP: The final Q3 GDP should largely confirm a stronger-than-expected +0.2% q/q and +2.1% y/y expansion. Weak global demand and surging inflationary pressures emanating from the Ukraine war has led to substantially weakened EU growth outlooks according to the European Commission's November forecast. 2022 growth is anticipated to be stronger than initially expected, underpinned by strong consumer spending. However, this is likely to be short-lived. GDP should see weak growth of 0.3% in 2023 (below the 0.9% projected by the ECB).
Canada Interest Rate Decision: The BOC expected to slow the hiking cycle to 25bp at the December meeting, lifting rates to 4.00%. A 50bp hike remains a likely tail risk, with economists leaning towards the latter whilst markets are pricing around 29bp. This would bring rates to the same level as the Fed.
Fed Chair Powell noted on Wednesday that December may see the scale of rate hikes moderate, implying a lower terminal rate and cementing a 50bp December hike. This pivot suggests less pressure on central banks to play catch-up.
THURSDAY
No major data releases.
FRIDAY
US PPI: US factory-gate inflation should cool another 0.9pp to +7.1% y/y in the November print. Core PPI is set to followed suit, easing since March highs to +6.7% y/y in October with a 1pp step down to +5.7% y/y likely for November.
US Prelim Michigan Sentiment Index: The U. Michigan index is forecasted to hold steady at 56.8 in the December flash, as consumer confidence remains subdued. This remains above the low of 50.0 recorded in June yet confirms a pause in the Aug to Oct improvements. Weak consumer sentiment headed into the holiday season will likely see softer retail sales, as households grapple with less disposable income and uncertain economic outlooks. Inflation expectations will be closely watched, after ticking up again to 3.0% in the 5-10 -year November index. US CPI has slowed for four consecutive months, yet with core CPI only seeing initial relief underlying cost pressures will need to ease further to reinstate confidence in price stabilisation.
| Date | GMT/Local | Impact | Flag | Country | Event |
| 03/12/2022 | 0230/0330 |  | EU | ECB Lagarde at Bank of Thailand Roundtable | |
| 05/12/2022 | 2200/0900 | * |  | AU | IHS Markit Final Australia Services PMI |
| 05/12/2022 | 0030/0930 | ** |  | JP | IHS Markit Final Japan Services PMI |
| 05/12/2022 | 0145/0945 | ** |  | CN | IHS Markit Final China Services PMI |
| 05/12/2022 | 0145/0245 | | EU | ECB Lagarde at Central Bank Governors IMF Seminar | |
| 05/12/2022 | 0700/0200 | * |  | TR | Turkey CPI |
| 05/12/2022 | 0815/0915 | ** |  | ES | IHS Markit Services PMI (f) |
| 05/12/2022 | 0845/0945 | ** |  | IT | IHS Markit Services PMI (f) |
| 05/12/2022 | 0850/0950 | ** |  | FR | IHS Markit Services PMI (f) |
| 05/12/2022 | 0855/0955 | ** |  | DE | IHS Markit Services PMI (f) |
| 05/12/2022 | 0900/1000 | ** | | EU | IHS Markit Services PMI (f) |
| 05/12/2022 | 0930/1030 | * | | EU | Sentix Economic Index |
| 05/12/2022 | 0930/0930 | ** |  | UK | IHS Markit/CIPS Services PMI (Final) |
| 05/12/2022 | 1000/1100 | ** | | EU | retail sales |
| 05/12/2022 | - | | EU | ECB Panetta at Eurogroup Meeting | |
| 05/12/2022 | 1330/0830 | * |  | CA | Building Permits |
| 05/12/2022 | 1445/0945 | *** |  | US | IHS Markit Services Index (final) |
| 05/12/2022 | 1500/1000 | *** | | US | ISM Non-Manufacturing Index |
| 05/12/2022 | 1500/1000 | ** | | US | factory new orders |
| 05/12/2022 | 1630/1130 | * | | US | US Treasury Auction Result for 26 Week Bill |
| 05/12/2022 | 1630/1130 | * | | US | US Treasury Auction Result for 13 Week Bill |
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.