We have a very busy week ahead of us with three central banks deciding on policy: the BoJ, the FOMC and the BoE. On the data front, the US employment report, due out on Friday, is likely to take center stage. The US core PCE index, the Fed’s favorite inflation metric, as well as Eurozone’s inflation and GDP data, are likely to attract attention as well.
Monday appears to be a relatively quiet day in terms of economic events and releases. The only indicator worth noting is Germany’s preliminary CPI for July. The German inflation rate is expected to have remained unchanged at +2.1% yoy, something that would support the case for Eurozone’s headline print, due out on Tuesday, to have held steady as well.
On Tuesday, Asian time, the BoJ concludes its two-day policy gathering. Following the recent reports that policymakers have been discussing possible changes to monetary policy, some investors may have raised bets that the Bank may start scaling back its stimulus program soon. However, with all Japanese inflation metrics, even the Bank’s own core CPI, well below its 2% objective, it’s hard for us to imagine the Bank taking a step towards normalization at this meeting. As for Japan’s economic indicators, we get the nation’s unemployment rate and the preliminary industrial production data, both for June.
From China, we have the official manufacturing and non-manufacturing PMIs for July. Expectations are for the manufacturing index to...
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