Following the FOMC and RBNZ meetings last week, it is the turn of the RBA to decide on monetary policy, but once again, we don’t expect any fireworks. On Friday, the US and Canadian employment reports will be in the spotlight, while on the political front, the annual conference of the UK Conservative Party, which started yesterday and will continue until Wednesday, will be closely watched.
Monday is a PMI day. During the European morning, we get the final manufacturing prints for September from several European nations and the Eurozone as a whole. As it is usually the case, the final numbers are expected to confirm their preliminary estimates.
The UK manufacturing PMI for September is also coming out. In August, the PMI declined to a 2-year low of 52.8, with the IHS Markit Director Rob Dobson noting that the report is broadly consistent with zero growth in manufacturing production. Now the index is expected to have declined further, to 52.5 from 52.8, which could raise some concerns over the sector’s support to the economy in Q3. That said, as we have noted several times in the past, investors are likely to focus more on the services PMI, due out on Wednesday, in order to get a clearer picture on how the economy may have performed during the last month the quarter, as the service sector accounts for around 80% of the UK GDP.
We get September manufacturing PMIs from the US as well. The final Markit index is expected to confirm its first estimate of 55.6, while the more-closely-watch ISM index is forecast to have declined to 60.1 from 61.3.
In Asia, Chinese markets will be closed for the whole week in celebration of the National Day holiday.
On the political front, the UK Conservative Party has begun its annual conference yesterday, which will continue until...
Read the full financial markets weekly outlook on JFD Research.