Despite a hectic weekend which saw the president of the United States test postitive for COVID-19 (Press Secretary Kayleigh McEnany also tested postitive earlier today), it is looking to be a relatively quiet week event-wise.
For the U.S., the VP debate will be hosted Wednesday, with the Fed also hosting a conference that same day.
The ECB will host a meeting Thursday.
Fed Chair Jay Powell will speak Tuesday, while Christine Lagarde, president of the ECB, speaks both Tuesday and Wednesday.
Over the weekend, the ECB trademarked “Digital Euro”. Lagarde will likely speak on any new developments regarding the banks research into a digital currency.
However, outside the big two, it’s a quiet week for other central banks. The only G20 policy decision comes from Australia on Tuesday. Experts believe there will be no change in policy, while also looking for any new information on potential rate cuts.
The main data to watch out for this this week will be the release of the services and composite PMIs around the world.
PMIs are index of the prevailing direction of economic trends in the manufacturing and service sectors. It consists of a diffusion index that summarizes whether market conditions, as viewed by purchasing managers, are expanding, staying the same, or contracting.
The major releases being the UK PMI release on Tuesday and China’s PMI announced Thursday.
Early readings show signs that the services sector within Europe has been hurt by a second wave of infections.
U.S.
Conflicting reports of President Trump’s health over the weekend did little to spook investors Monday morning, as major indices opened in the green. This is likely a combination of the postitive news outlook being accepted in terms of President’s health, while investors are also optimistic on new stimulus from Washington.
DJT is now on dose two of five of the experimental antiviral drug Remdesivir, and is not experiencing any side effects. If things continue to go well, he may be allowed to continue his treatment back at the White House on Monday, his team said.
However, common belief among health professionals is that the next few days are key for the President, which will determine as to whether the virus symptoms become more aggressive or not.
The U.S. data focus will be the ISM services survey, released today (a monthly index based on surveys of 300 purchasing managers throughout the United States in 20 industries in the manufacturing area) and the weekly jobless claims on Thursday.
Fed Chair Powell is also expected to give a keynote speech on the economic outlook for the country on Wednesday.
ECB
There were reports of differences in opinion among the ECB Governing Council last week. Hawks want to slow the pace of PPEP (pandemic purchase plan which buys private and public sector securities) buying, while doves worry about a strengthening EUR.
Oil
Offshore oil wells along the Gulf Coast will prepare for another beating this week as tropical storm delta forms with a possible late week downfall. Hundreds have had to shutdown operations as the hurricane season has picked up in late summer.
Libya’s oil output rose to 295,000 barrels following a truce in the OPEC nation’s civil conflict and the lifting of a blockade on energy facilities.
Saudi Arabian Finance Ministry sees oil hovering around $50/barrel for the next three years, according to Goldman Sachs Group Inc.’s analysis of the KSA’s pre-budget statement.
Here is a day by day calendar of key events summarized (Deutsche Bank):
Monday October 5
- Data: September services and composite PMIs from Japan, Russia, Italy, France, Germany, Euro Area UK, Brazil and US, Euro Area August retail sales, US September ISM services index
- Central Banks: Fed’s Evans, Bostic speak
Tuesday October 6
- Data: Germany August factory orders, September construction PMI, UK September construction PMI, Canada August international merchandise trade, US August trade balance, JOLTS job openings
- Central Banks: Reserve Bank of Australia monetary policy decision, ECB President Lagarde, Chief Economist Lane, Fed Chair Powell, and Fed’s Harker, Bostic and Kaplan speak
Wednesday October 7
- Data: Japan preliminary August leading index, Germany August industrial production, Italy August retail sales, US weekly MBA mortgage applications, August consumer credit
- Central Banks: FOMC release meeting minutes, ECB President Lagarde, ECB’s Villeroy, Fed’s Rosengren, Bostic, Kashkari, Williams, Evans speak
- Politics: US Vice Presidential Debate
Thursday October 8
- Data: Japan August current account balance, China September services and composite PMI, Bank of France September industry sentiment indicator, Germany August trade balance, Canada September housing starts, US weekly initial jobless claims
- Central Banks: ECB release monetary policy account, Bank of England Governor Bailey, Bank of Canada Governor Macklem, ECB’s Schnabel and Hernandez de Cos speak
Friday October 9
- Data: UK August GDP, France August industrial production, Italy August industrial production, Canada September net change in employment, unemployment rate, US final August wholesale inventories
Works Cited:
https://www.zerohedge.com/economics/key-events-week-powell-vp-debate-ism-and-fed-speakers-galore
https://www.investopedia.com/terms/p/pmi.asp
Deutsche Bank
Bank of America
Goldman Sachs