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MNI China Daily Summary: Monday, October 23

MNI BRIEF: Inflation Down, Deficits Up - Bundesbank Report

MNI BRIEF: China To Reach Target of 5% GDP Growth - Lou Jiwei

EZ/UK T-Bill Calendar: 3/6-Month ATB Auction on Tuesday

EZ/UK Bond Supply Calendar: Netherlands, UK, Germany Due Tues

BoC Data Watch

MNI BRIEF: Stabilizing Prices Helps BOC Turn Neutral-Freeland

MNI BRIEF: Canada Needs CAD1 Trln To Fix Housing Squeeze- CMHC

MNI BRIEF: Canada Shows No Progress Closing Housing Shortfall

MNI GLOBAL WEEK AHEAD - UK Jobs, US CPI, ECB and CBR

TUESDAY - UK LABOUR MARKET

UK labour market data is due for release on Tuesday at 7:00BST and will be one of the final data releases ahead of the next MPC policy decision which is due Thursday 21 September. One of the main concerns for the MPC at present the moment is the continued persistence in wage pressures. The data to June saw private sector regular wages rise from 7.9%Y/Y to 8.2%Y/Y while total inc. bonus rose from 7.4%3m/YoY to 7.9%3m/YoY. The whole economy data surprised even more to the upside as the NHS wage deal added around estimating 0.5ppt to the headline index and which will persist over the next two monthly releases. The early consensus looks for unchanged whole economy wage growth in the July report. Outside of wage growth, the rest of the labour market report showed some reduced tightness, with the unemployment rate has rising from 4.0% to 4.2%, the highest since October 2021 and from a trough of 3.5% in August 2022, and the early consensus expects this to tick up further to 4.3% in the July report. Survey data has also showed to some reductions in tightness in labour market data, but the MPC will want to see private sector wage growth to tick lower still before contemplating a pause in rate hikes, in our view. In late Friday trading, markets were pricing just over a 75% probability of a 25bp hike in September.

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TUESDAY - UK LABOUR MARKET

UK labour market data is due for release on Tuesday at 7:00BST and will be one of the final data releases ahead of the next MPC policy decision which is due Thursday 21 September. One of the main concerns for the MPC at present the moment is the continued persistence in wage pressures. The data to June saw private sector regular wages rise from 7.9%Y/Y to 8.2%Y/Y while total inc. bonus rose from 7.4%3m/YoY to 7.9%3m/YoY. The whole economy data surprised even more to the upside as the NHS wage deal added around estimating 0.5ppt to the headline index and which will persist over the next two monthly releases. The early consensus looks for unchanged whole economy wage growth in the July report. Outside of wage growth, the rest of the labour market report showed some reduced tightness, with the unemployment rate has rising from 4.0% to 4.2%, the highest since October 2021 and from a trough of 3.5% in August 2022, and the early consensus expects this to tick up further to 4.3% in the July report. Survey data has also showed to some reductions in tightness in labour market data, but the MPC will want to see private sector wage growth to tick lower still before contemplating a pause in rate hikes, in our view. In late Friday trading, markets were pricing just over a 75% probability of a 25bp hike in September.

Keep reading...Show less