Thomas Watts, Investment Analyst, abrdn, comments on the economic data releases this week.
He said: “With the Black Friday sales in full swing, it seems prudent that the coming week allows us to check up on the health of the High Street, with a range of different data points being released on today and Tuesday.
“The beginning of the week sees the Confederation of British Industry make public its realised sales numbers, detailing the figures of a survey asking some 125 retail and wholesale companies, all asked to rate the relative level of current sales volumes.
“The figures should go hand in hand with Tuesday’s data from the British Retail Consortium, releasing their Shop Price Index numbers. Describing the change in the price of goods sold by its members, the data will prove useful in gauging overall inflation as the prices paid on the High Street will make up a large constituent of the economy’s final inflation reading.
“Another piece of data that also dovetails with high street spending is consumer sentiment, the inherited wisdom being that the more buoyant the consumer is, the more they tend to spend. With this in mind, investor gaze will be fixed on the US on Tuesday as we get the opportunity to see how the consumer in the world’s largest economy is feeling. The data will be complimented the day after with GDP data for the US. GDP numbers are particularly useful as they represent the broadest measure of growth and the primary gauge of the economy’s health.
“The second half of the week should take a distinctively American tone, with the week being rounded off with US monthly Core PCE Price Index numbers. Predicted to make quite the impact on the markets after its release on Friday, the data differs from normal inflation readings in that it only measures goods and services targeted towards and consumed by individuals. CPI readings also only covers out-of-pocket expenditures on goods and services purchased. It excludes other expenditures that are not paid for directly, for example, medical care which is usually paid for by insurance in the US. These are, however, included in the PCE. Adding even more importance to the figures is that the data is reportedly the preferred piece of data for the US Federal Reserve, using it as their primary inflation measure.”