With plenty of key data releases coming through this week, Thomas Watts, Senior Investment Analyst, abrdn MPS, comments on the economic data we can expect to see coming through this week and the implications for markets as well as the global economy as follows:
“With bank holidays in Australia and China today, the coming week may seem a little sparse in terms of economic data releases during its beginning, however, tomorrow sees the British Retail Consortium releases its annual Shop Price index numbers. Although the figures lead the government released consumer inflation data by about 10 days, they are narrower in scope as they only include goods purchased from retailers who belong to the BRC. Nonetheless the figures should give us a decent update as to how the UK high street is performing and what we should expect from both upcoming retail sales and inflation numbers.
Wednesday sees the Royal Institution of Chartered Surveyors (RICS) release their House Price balance data. The numbers are vitally important, especially for the housing and wider market as the data they release represents the percentage of surveyors reporting a price increase in their designated area, acting as a prime measurement of housing inflation. To add context, above 0.0% indicates more surveyors reported a rise in prices, below indicates more reported a fall. With the previous reading sitting at 1% but jumping from -19% the month previous many will be hoping that the trend continues as hope as rates look set to gradually fall.
The stream of UK data does not stop there however as the Office for National Statistics releases UK Gross Domestic Product (GDP) on Thursday, the broadest gauge of economic health. With the UK economy having bounced back quicker and stronger than many expected, both those in the City of London and Westminster will hope the good news continues.
Perhaps the most significant piece of economic data being made public this week, however, comes from the US. With financial markets grappling over when and by how deeply the US Federal Reserve will cut rates by, this week’s inflation data could be crucial. Forecast to fall to 2.3% from last month’s reading of 2.5%, anything wildly different from expectations could lead to rapid changes in rate expectations going forward.”
