A new, “more mutated” and possibly more infectious covid variant out of South Africa weighed heavily on equities and boosted the demand for bonds on Friday, removing the feel good factor from strong US data earlier and the assumption the FED was tilting further into the hawkish camp with a possible faster taper and multiple rate hikes in 2022. A very cautious tone will likely prevail next week. Data will be topped by NFP on Friday and an expected continued tight jobs market.
Monday – 29 November 2021
German Preliminary CPI (EUR, all-day from GMT 07:00) – The German federal states will be releasing inflation data throughout the day after a record leap for Import prices on Friday. Last month there was a 0.5% increase, this month 0.7% is expected.Pending Home Sales (USD, GMT 15:00) – New Home Sales cooled last Thursday recording a still strong 745K but well below the 801K expected. The pending homes sales number can be volatile as home buyers can drop from registrations without consequence. Last month pending home sales fell -2.3%, this month -2.5% is expected.
Speeches – BOJ Gov Kuroda & Fed Chair Powell
Tuesday – 30 November 2021
Manufacturing & Non-Manufacturing PMIs (CNY, GMT 01:00) – Manufacturing PMI’s have been in contraction mode since September will a tick over 50 be seen today? Conversely, Non-Manufacturing PMIs have been in expansion for the last two months showing more resilience.CPI Flash Estimate y/y (EUR, GMT 10:00) – Annualized EZ Inflation was running at 4.1% last month and with energy costs spiking this month the reading is expected to top 4.5%.Gross Domestic Product m/m (CAD, GMT 13:30) – a rise to 0.7% from 0.4% last month is expected and the annualized figure is expected to leap from a contraction of -1.1% to 2.5%.Fed Chair Powell Testifies (USD, GMT 15:00) Powell is due to testify on the CARES Act before the Senate Banking Committee, in Washington DC.
Wednesday – 01 December 2021
Q3 Gross Domestic Product – (AUD, GMT 00:30) – The Australian economy was severely restricted during Q3 as lockdowns in Melbourne & wider Victoria persisted, and GDP sank to lows of 0.7% in September from 3.3% in December 2020. A further fall to 0.5% is expected.ADP Non-Farm Employment Change (USD, GMT 13:15) – Private payrolls have been very volatile in the last few months; 571K new jobs were registered last month and this month it is expected to have declined to 460K, however, there have been some big misses and beats for this key data point as the US economy moves forward.ISM Manufacturing PMI (USD, GMT 15:00) – This key data point from the ISM has been expanding steadily and a further rise is expected to 61.00 this month from 60.8 last time.Fed Chair Powell Testifies (USD, GMT 15:00) – Second day of testimony on the CARES Act before the Senate Banking Committee, in Washington DC.
Thursday – 02 December 2021
OPEC-JMMC Meetings (ALL, GMT All Day) – Following the US led, coordinated release of millions of barrels of strategic reserves by 6 countries, this months OPEC meeting may have added spice. However, it is likely that the cartel will keep production at current levels resisting pressure from the White House and elsewhere to pump more crude.Weekly Claims (USD, GMT 13:30) Following last weeks 52-year low reading at only 199K this weeks number is eagerly awaited. Seasonality factors apart, the evidence of the tight US jobs market continues, a more economic cycle average is 250-260K.
Friday – 03 December 2021
Non-Farm Employment Change (USD, GMT 13:30) 440k 531k in October, 312k in September, and 483k in August. The Unemployment rate is expected to hold steady at 4.6%, Annualized Earnings to increase again to 5.0% from 4.9% and the all important participation rate to struggle to move over 61.6%.Employment Change (CAD, GMT 13:30) Canada generated 31.2k news jobs last month, a miss of expectations of 42.0k and a huge decline from the 157.1k from October. The Unemployment rate is expected to hold at pandemic lows at 6.7%.ISM Non-Manufacturing PMI (USD, GMT 15:00) – This key data point from the ISM has been volatile recently and a decline this month is expected to, a still very healthy 65.7 from 66.7 last month.
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Stuart Cowell
Head Market Analyst
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