MNI Global Week Ahead: US PCE, RBA, Riksbank and SNB
MNI (LONDON) - See below for the key events in Developed and Emerging Markets next week:
Developed Markets
MONDAY – Eurozone Flash PMIs
The Eurozone September flash PMI round is due on Monday. The EZ-wide manufacturing reading is expected at 45.7 (little changed from August’s 45.8), while the services PMI is seen falling to 52.3 (vs 52.9 prior). Primary focus will be on the French services reading, which is expected to fall back to 53.2 after an Olympic-induced bounce to 55.0 in August. The PMIs are one of the few pieces of Eurozone activity data that we will receive before the ECB’s October decision, but a weak set of readings is unlikely to be enough to tempt policymakers into considering a cut at that gathering. Later in the week, we also receive flash inflation data from Spain and France, with the Eurozone-wide figure released the following Tuesday.
TUESDAY - RBA Decision
The RBA meets on Tuesday September 24 and is expected to leave rates at 4.35% despite the OECD trend to cut. RBA Governor Bullock has made it clear that it is too soon to discuss easing and that current conditions mean there won't be a cut in the "near term". The Board remains "vigilant" to upside risks to inflation and is yet to be "confident" that it will "sustainably" return to target. While growth data since the August meeting have been weak, the labour market has remained robust but the economy is moving broadly as the RBA expected at the last meeting.
WEDNESDAY – Riksbank Decision
The Riksbank is expected to deliver its third 25bp cut of 2024 on Wednesday, bringing the policy rate to 3.25%. At its August decision, the Riksbank opened the door to cuts at each of the three remaining meetings this year, should the inflation outlook remain favourable (a move that was widely, but not unanimously, expected). The MNI Markets Team currently expects three more 25bp cuts to be delivered (including in September), which would imply a year-end policy rate of 2.75%. However, we view the risks as tilted towards a faster pace of easing. The September decision will include an updated Monetary Policy Report and rate path projection. Analysts generally expect a downward revision to the rate path, to take into account August’s guidance tilt. We think the updated rate path will indicate a chance of 50bp cuts at the November and/or December meetings.
THURSDAY – SNB Decision
The SNB is widely expected to cut rates by 25bps on Thursday, bringing the policy rate to 1.00%. 23 of the 26 analysts surveyed by Bloomberg expect a 25bp cut, with the remaining 3 forecasting no change in rates. However, markets are pricing in almost a 50% implied probability of a larger 50bp cut. Inflation is on track to undershoot the SNB’s 1.5% Y/Y forecast for Q3, most recently easing to 1.1% in August. Although the August disinflation was largely import (i.e. energy) driven, the moderation in non-rental services inflation should support further easing of policy at the margin. Since the June meeting, the Franc has appreciated ~4% against the US dollar and ~0.2% against the Euro. These developments provide further support for another quarter-point cut, and the SNB is likely to re-iterate its willingness “to be active in the foreign exchange market as necessary” in its policy statement.
FRIDAY - US PCE
The monthly PCE report on Friday headlines the US data for the week ahead. Core PCE inflation is expected to show another Fed-friendly print, with unrounded analyst estimates suggesting it could come in right between 0.1% and 0.2% M/M. If accurate, it would see a fourth month with core inflation at or below the pace consistent with 2% annualized inflation and should see greater focus on the activity side of the report. Real personal spending growth is expected to ease to just 0.1% M/M after what’s been a strong run recently, including the 0.4% in July and a trend pace close to 4% annualized. This prior strength has however come at the expense of running down the savings ratio even lower, dipping below 3% in July and coming close to the 2.7% seen in mid-2022 that marked the lowest since 2008. With excess savings accumulated through the pandemic broadly estimated to have been fully or almost fully depleted, the assumed inability to run this rate much lower could be a headwind to consumption growth ahead.
Emerging Markets
TUESDAY - NBH Decision (Hungary)
The National Bank of Hungary is expected to resume its easing cycle with a 25bp cut to the base rate, taking it to 6.50%, following a pause at the August meeting. Since the previous meeting, the Fed has begun its easing cycle with a bold 50bp cut while the forint has performed on relatively stable footing, offering NBH officials greater room for manoeuvre. The Council is likely to stick to a relatively cautious tone, but could signal the possibility of another rate cut before year-end.
WEDNESDAY - CNB Decision (Czechia)
The Czech National Bank is expected to deliver another 25bp rate cut next week, having slowed the pace of monetary easing in August, following a series of four 50bp cuts earlier this year. Inflation is within the CNB's tolerance band, with central bank staff expecting it to stay close to the +2% target over the next two years, but the Bank Board remains alert to upside risks. Note that next week's meeting takes place on a Wednesday rather than Thursday.
THURSDAY - Banxico Decision (Mexico)
Banxico is expected to cut the overnight interbank interest rate by 25bps to 10.50%, supported by further progress on the disinflation process and concerns surrounding growth. Domestic uncertainty related to Morena’s constitutional reform initiative has placed pressure on MXN, which could become a concern should there be a further deterioration. However, the Fed’s bolder move to initiate its easing cycle should provide the Banxico committee with the required flexibility to continue easing.
Date | GMT/Local | Impact | Country | Event |
20/09/2024 | 1700/1300 | ** | US | Baker Hughes Rig Count Overview - Weekly |
20/09/2024 | 1800/1400 | US | Philly Fed's Pat Harker | |
23/09/2024 | 2300/0900 | *** | AU | Judo Bank Flash Australia PMI |
23/09/2024 | 0645/0845 | EU | ECB's Elderson at Real Estate summit | |
23/09/2024 | 0715/0915 | ** | FR | S&P Global Services PMI (p) |
23/09/2024 | 0715/0915 | ** | FR | S&P Global Manufacturing PMI (p) |
23/09/2024 | 0730/0930 | ** | DE | S&P Global Services PMI (p) |
23/09/2024 | 0730/0930 | ** | DE | S&P Global Manufacturing PMI (p) |
23/09/2024 | 0800/1000 | ** | EU | S&P Global Services PMI (p) |
23/09/2024 | 0800/1000 | ** | EU | S&P Global Manufacturing PMI (p) |
23/09/2024 | 0800/1000 | ** | EU | S&P Global Composite PMI (p) |
23/09/2024 | 0830/0930 | *** | GB | S&P Global Manufacturing PMI flash |
23/09/2024 | 0830/0930 | *** | GB | S&P Global Services PMI flash |
23/09/2024 | 0830/0930 | *** | GB | S&P Global Composite PMI flash |
23/09/2024 | 1000/1100 | ** | GB | CBI Industrial Trends |
23/09/2024 | 1200/0800 | US | Atlanta Fed's Raphael Bostic | |
23/09/2024 | 1300/1500 | EU | ECB's Cipollone statement on digital euro at Hearing | |
23/09/2024 | 1345/0945 | *** | US | S&P Global Manufacturing Index (Flash) |
23/09/2024 | 1345/0945 | *** | US | S&P Global Services Index (flash) |
23/09/2024 | 1415/1015 | US | Chicago Fed's Austan Goolsbee | |
23/09/2024 | 1530/1730 | EU | ECB's Cipollone in panel discussion at House of the euros | |
23/09/2024 | 1530/1130 | * | US | US Treasury Auction Result for 26 Week Bill |
23/09/2024 | 1530/1130 | * | US | US Treasury Auction Result for 13 Week Bill |
24/09/2024 | 0030/0930 | ** | JP | Jibun Bank Flash Japan PMI |
24/09/2024 | 0430/1430 | *** | AU | RBA Rate Decision |
24/09/2024 | 0800/1000 | *** | DE | IFO Business Climate Index |
24/09/2024 | 0900/1000 | * | GB | Index Linked Gilt Outright Auction Result |
24/09/2024 | 1230/0830 | ** | US | Philadelphia Fed Nonmanufacturing Index |
24/09/2024 | 1255/0855 | ** | US | Redbook Retail Sales Index |
24/09/2024 | 1300/0900 | ** | US | S&P Case-Shiller Home Price Index |
24/09/2024 | 1300/0900 | ** | US | FHFA Home Price Index |
24/09/2024 | 1300/1500 | ** | BE | BNB Business Sentiment |
24/09/2024 | 1400/1000 | *** | US | Conference Board Consumer Confidence |
24/09/2024 | 1400/1000 | ** | US | Richmond Fed Survey |
24/09/2024 | 1530/1130 | * | US | US Treasury Auction Result for Cash Management Bill |
24/09/2024 | 1700/1300 | * | US | US Treasury Auction Result for 2 Year Note |
24/09/2024 | 1710/1310 | CA | BOC Governor Macklem fireside chat on "Growth During Uncertainty" | |
24/09/2024 | 2210/1810 | US | New York Fed's Roberto Perli | |
25/09/2024 | 2301/0001 | * | GB | Brightmine pay deals for whole economy |
25/09/2024 | 0130/1130 | *** | AU | CPI Inflation Monthly |
25/09/2024 | 0600/0800 | ** | SE | PPI |
25/09/2024 | 0600/1400 | ** | CN | MNI China Liquidity Index (CLI) |
25/09/2024 | 0645/0845 | ** | FR | Consumer Sentiment |
25/09/2024 | 0700/0900 | ** | ES | PPI |
25/09/2024 | 0730/0930 | *** | SE | Riksbank Interest Rate Decison |
25/09/2024 | 0800/0900 | GB | BOE's Greene Speech on Consumption | |
25/09/2024 | 0900/1000 | ** | GB | Gilt Outright Auction Result |
25/09/2024 | 1100/0700 | ** | US | MBA Weekly Applications Index |
25/09/2024 | 1300/1500 | EU | MNI Connect Video Conference on ‘The EU and Global Trade Challenges’ | |
25/09/2024 | 1400/1000 | *** | US | New Home Sales |
25/09/2024 | 1430/1030 | ** | US | DOE Weekly Crude Oil Stocks |
25/09/2024 | 1530/1130 | ** | US | US Treasury Auction Result for 2 Year Floating Rate Note |
25/09/2024 | 1700/1300 | * | US | US Treasury Auction Result for 5 Year Note |
26/09/2024 | 0600/0800 | * | DE | GFK Consumer Climate |
26/09/2024 | 0700/0900 | ** | SE | Economic Tendency Indicator |
26/09/2024 | 0730/0930 | *** | CH | SNB Interest Rate Decision |
26/09/2024 | 0800/1000 | ** | EU | M3 |
26/09/2024 | 0800/1000 | ** | IT | ISTAT Business Confidence |
26/09/2024 | 0800/1000 | ** | IT | ISTAT Consumer Confidence |
26/09/2024 | 0900/1100 | EU | ECB's Elderson remarks at governance & risk meeting | |
26/09/2024 | 1230/0830 | *** | US | Jobless Claims |
26/09/2024 | 1230/0830 | ** | US | WASDE Weekly Import/Export |
26/09/2024 | 1230/0830 | *** | US | GDP |
26/09/2024 | 1230/0830 | * | CA | Payroll employment |
26/09/2024 | 1230/0830 | ** | US | Durable Goods New Orders |
26/09/2024 | 1310/0910 | US | Fed's Susan Collins, Adriana Kugler | |
26/09/2024 | 1325/0925 | US | New York Fed's John Williams | |
26/09/2024 | 1330/1530 | EU | ECB Lagarde address at ESRB Conference | |
26/09/2024 | 1400/1000 | ** | US | NAR Pending Home Sales |
26/09/2024 | 1415/1615 | EU | ECB's De Guindos in macroprudential policy panel | |
26/09/2024 | 1430/1030 | ** | US | Natural Gas Stocks |
26/09/2024 | 1500/1100 | ** | US | Kansas City Fed Manufacturing Index |
26/09/2024 | 1600/1800 | EU | ECB's Schnabel at Wirtschaftsrat der CDU e.V | |
26/09/2024 | 1700/1300 | US | Fed's Neel Kashkari, Michael Barr | |
26/09/2024 | 1700/1300 | ** | US | US Treasury Auction Result for 7 Year Note |
26/09/2024 | 1900/1500 | *** | MX | Mexico Interest Rate |
27/09/2024 | 2330/0830 | ** | JP | Tokyo CPI |
27/09/2024 | 0645/0845 | *** | FR | HICP (p) |
27/09/2024 | 0645/0845 | ** | FR | PPI |
27/09/2024 | 0645/0845 | ** | FR | Consumer Spending |
27/09/2024 | 0700/0900 | *** | ES | HICP (p) |
27/09/2024 | 0700/0900 | *** | ES | GDP (f) |
27/09/2024 | 0755/0955 | ** | DE | Unemployment |
27/09/2024 | 0800/1000 | ** | IT | PPI |
27/09/2024 | 0800/1000 | ** | EU | ECB Consumer Expectations Survey |
27/09/2024 | 0815/1015 | EU | ECB's Lane remarks at Fiscal Policy conference | |
27/09/2024 | 0900/1100 | ** | EU | EZ Economic Sentiment Indicator |
27/09/2024 | 0900/1100 | * | EU | Consumer Confidence, Industrial Sentiment |
27/09/2024 | 0940/1140 | EU | ECB's Cipollone speech at Economics of Payments XIII conference | |
27/09/2024 | 1000/1100 | ** | GB | CBI Distributive Trades |
27/09/2024 | 1230/0830 | *** | US | Personal Income and Consumption |
27/09/2024 | 1230/0830 | *** | CA | Gross Domestic Product by Industry |
27/09/2024 | 1230/0830 | ** | US | Advance Trade, Advance Business Inventories |
27/09/2024 | 1230/0830 | *** | CA | Gross Domestic Product by Industry |
27/09/2024 | 1330/0930 | US | Fed's Susan Collins, Adriana Kugler | |
27/09/2024 | 1400/1000 | ** | US | U. Mich. Survey of Consumers |
27/09/2024 | 1500/1100 | CA | Finance Dept monthly Fiscal Monitor (expected) | |
27/09/2024 | 1700/1300 | ** | US | Baker Hughes Rig Count Overview - Weekly |