UPCOMING EVENTS:
- Monday: China Caixin Services PMI, Eurozone PPI, US ISM Services PMI, Fed’s SLOOS.
- Tuesday: Japan Average Cash Earnings, RBA Policy Decision, Swiss Unemployment Rate and Retail Sales, Eurozone Retail Sales, Canada Services PMI.
- Wednesday: New Zealand Labour Market report, BoC Minutes.
- Thursday: BoJ Summary of Opinions, US Jobless Claims.
- Friday: China CPI, Canada Labour Market report.
Monday
The US ISM Services PMI is expected at 51.0 vs. 48.8 prior. This survey hasn't been giving any clear signal lately as it’s just been ranging since 2022. The latest S&P Global US Services PMI rose to the highest level in 28 months. The good news in the report was that “the rate of increase of average prices charged for goods and services has slowed further, dropping to a level consistent with the Fed’s 2% target”.
The bad news was that “both manufacturers and service providers reported heightened uncertainty around the election, which is dampening investment and hiring. In terms of inflation, the July survey saw input costs rise at an increased rate, linked to rising raw material, shipping and labour costs. These higher costs could feed through to higher selling prices if sustained or cause a squeeze on margins.”
![US ISM Services PMI](https://images.forexlive.com/images/US%20ISM%20Services%20PMI_id_6c8a8c28-1ee4-47f4-ae20-2e380f9fc3b2_size900.jpg)
Tuesday
The Japanese Average Cash Earnings Y/Y is expected at 2.3% vs. 1.9% prior. As a reminder, the BoJ hiked interest rates by 15 bps at the last meeting and Governor Ueda said that more rate hikes could follow if the data supports such a move. The economic indicators they are focusing on are: wages, inflation, service prices and the GDP gap.
![Japan Average Cash Earnings YoY](https://images.forexlive.com/images/Japan%20Average%20Cash%20Earnings%20YoY_id_ce5bb249-2dd4-4dcf-bb3a-e13237357833_size900.jpg)
The RBA is expected to keep the Cash Rate unchanged at 4.35%. The RBA has been maintaining a hawkish tone due to the stickiness in inflation and the market at times even priced in high chances of a rate hike. The latest Australian Q2 CPI quelled those expectations as we saw misses across the board and the market (of course) started to see chances of rate cuts, with now 32 bps of easing seen by year-end (the increase on Friday was due to the soft US NFP report).
![RBA](https://images.forexlive.com/images/RBA_id_d1803478-d1ea-4fa4-b524-fc95b23f8a29_size900.jpeg)
Wednesday
The New Zealand Unemployment Rate is expected to jump to 4.7% vs. 4.3% prior with Job Growth Q/Q seen at -0.3% vs. -0.2% prior. The Labour Cost Index Y/Y is expected at 3.5% vs. 3.8% prior, while the Q/Q measure is seen at 0.8% vs. 0.8% prior. The labour market has been softening steadily in New Zealand and that remains one of the main reasons why the market continues to expect rate cuts coming much sooner than the RBNZ’s forecasts.
![New Zealand Unemployment Rate](https://images.forexlive.com/images/New%20Zealand%20Unemployment%20Rate_id_9ba16b8e-54e3-47d7-b7a6-c4bac7ac72e6_size900.jpg)
Thursday
The US Jobless Claims continue to be one of the most important releases to follow every week as it’s a timelier indicator on the state of the labour market. This particular release will be crucial as it lands in a very worried market after the Friday’s soft US jobs data.
Initial Claims remain inside the 200K-260K range created since 2022, although they’ve been climbing towards the upper bound lately. Continuing Claims, on the other hand, have been on a sustained rise and we saw another cycle high last week.
This week Initial Claims are expected at 250K vs. 249K prior, while there’s no consensus for Continuing Claims at the time of writing although the prior release saw an increase to 1877K vs. 1844K prior.
![US Jobless Claims](https://images.forexlive.com/images/US%20Jobless%20Claims_id_c75458c0-8fd3-4fcf-8c4a-a5b22d26617f_size900.jpg)
Friday
The Canadian Labour Market report is expected to show 25K jobs added in July vs. -1.4K prior and the Unemployment Rate to remain unchanged at 6.4%. As a reminder, the BoC cut interest rates to 4.50% at the last meeting and signalled further rate cuts ahead. The market is pricing 80 bps of easing by year-end.
![Canada Unemployment Rate](https://images.forexlive.com/images/Canada%20Unemployment%20Rate_id_32387d6a-7d0e-48b6-803e-342cf14436ee_size900.jpg)