Ahead of the game: 26 August 2024
Your weekly financial calendar for market insights and key economic indicators.
![stocks](http://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/news-article-image-folder/Adobe_stocks_26-06-2024.jpg/jcr:content/renditions/original-size.webp)
ASX 200 and US markets exhibit robust gains
This week, US equity markets consolidated their recent gains, bolstered by dovish Federal Open Market Committee (FOMC) meeting minutes, anticipation of dovish tones from Federal Reserve (Fed) Chair Powell at Jackson Hole, and economic data that supported the ongoing narrative of growth without inflation.
On the home front, the ASX 200 achieved its tenth straight day of gains, a milestone not seen in a decade. This rally was driven by strong corporate earnings and a continued recovery from the sharp sell-off experienced in early August.
The week that was: highlights
- The Bureau of Labor Statistics (BLS) preliminary annual benchmark revisions revealed a downward adjustment in non-farm payrolls by 818,000 for the year ending March 2024. The revision to employment levels was the largest since the Global Financial Crisis (GFC) in 2009
- The minutes from the July FOMC meeting were dovish, as widely expected, noting that most of the committee "observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policy at the next meeting"
- US weekly initial jobless claims rose by 4000 to 232,000, in line with expectations
- The US S&P Composite Purchasing Managers' Index (PMI) eased to 54.1 in August from 54.3 prior but remained in expansion territory for a 19th consecutive month
- The Eurozone (EA) Hamburg Commercial Bank (HCOB) Composite Flash PMI rose to 51.2 in August from 50.2 prior
- The UK S&P Composite Flash PMI rose to 53.4 from 52.8 prior
- In Australia, the Reserve Bank of Australia (RBA) meeting minutes were hawkish
- Crude oil fell 3.34% this week to $73.00
- Gold fell 0.88% this week to $2485
- Wall Street's gauge of fear, the Volatility Index (VIX), increased to 17.54 from 14.81 the prior week.
Key dates for the week ahead
Australia & New Zealand
- AU: Monthly Consumer Price Index (CPI) indicator (Wednesday, 28 August at 11.30am AEST)
- NZ: ANZ Business Confidence (Thursday, 29 August at 11.00am AEST)
- AU: Retail Sales (Friday, 30 August at 11.30am AEST)
China & Japan
- JP: Consumer Confidence (Friday, 30 August at 3.00pm AEST)
- CN: National Bureau of Statistics (NBS) Manufacturing PMI (Saturday, 31 August at 11.30am AEST)
United States
- US: Durable Goods Orders (Monday, 26 August at 10.30pm AEST)
- US: Personal Consumption Expenditures (PCE) Price Index (Friday, 30 August at 10.30pm AEST)
Europe & United Kingdom
- EA: Inflation (Friday, 30 August at 7.00pm AEST)
![indices](http://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/news-article-image-folder/Adobe_indices_07-11-2024.jpeg/jcr:content/renditions/original-size.webp)
Key events for the week ahead
-
AU
RBA monthly CPI indicator
Wednesday, 28 August at 11.30am AEST
Key Australian inflation measures released in late July were marginally softer than expected.
- Headline inflation: rose by 1.0% in the June quarter (consensus was +1.0%), bringing the annual rate to 3.8% from 3.6% prior, indicating the first increase in annual CPI since December
- The trimmed mean: rose by 0.8% in the June quarter (consensus was +1.0%), allowing the annual rate to fall to 3.9% from 4.0% prior – marking the sixth consecutive quarter of lower annual trimmed mean inflation
- The monthly CPI Indicator: for June rose by 3.8% in the 12 months to June, down from a 4.0% rise in May, while the core reading eased to 4.1% from 4.4% in May.
During the August board meeting, the board discussed the option of raising interest rates but decided that the case for leaving rates unchanged was stronger. The minutes also stated, “Based on the information available at the time of the meeting, it was unlikely that the cash rate target would be reduced in the short term, and it was not possible to either rule in or rule out future changes in the cash rate target.”
As July marks the first month of the new quarter, this monthly CPI indicator will only provide updates on approximately 60% of the basket. It will be skewed towards goods rather than the more problematic service components such as dining out, medical services, and transportation.
The preliminary expectation for the Monthly CPI Indicator in July is to ease to 3.7% year-on-year (YoY) from 3.8%. However, this may change as analysts adjust expectations in the coming days. The Australian interest rate market is currently pricing in a full 25 basis points (bp) rate cut by December and a cumulative 70 bp of cuts by May 2025.
RBA monthly CPI indicator chart
![RBA monthly CPI indicator chart](http://a.c-dn.net/c/content/dam/publicsites/igcom/au/images/News-and-articles/CPI23aug.png/jcr:content/renditions/original-size.webp)
-
EA
Inflation
Friday, 30 August at 7.00pm AEST
Last month, the annual inflation rate in the Euro Area increased slightly to 2.6% YoY from 2.5% the previous month, matching the preliminary estimate and surpassing market expectations of a decline to 2.4%. Meanwhile, the annual core inflation rate, which excludes volatile categories like energy, food, alcohol, and tobacco, held steady at 2.9% for the third consecutive month.
This month, the market will be watching for signs that inflation is continuing its decline towards the European Central Bank’s (ECB) 2% target. The rates market is fully priced for a 25 bp rate cut at the ECB’s 12 September meeting, with 63 bp of cumulative rate cuts expected before year-end.
EA core inflation chart
![EA core inflation chart](http://a.c-dn.net/c/content/dam/publicsites/igcom/au/images/News-and-articles/eurocoreinf23aug.png/jcr:content/renditions/original-size.webp)
-
US
PCE price index
Friday, 30 August at 10.30pm AEST
The July Fed minutes revealed that US policymakers are increasingly confident that inflation is heading towards their 2% target, citing further disinflation and rising unemployment. The Fed acknowledged that disinflation has been broad-based across major subcomponents of core inflation, with a significant majority of policymakers indicating that it may be appropriate to cut rates at the next meeting.
Markets have largely priced in a September rate cut, with the debate now focusing on the extent of the cut and the outlook beyond September. The rates market is pricing a 74% probability of a 25 bp cut and a 26% chance of a larger 50 bp move.
Barring any significant upside surprise in the PCE price index, the consensus is likely to lean towards a 25 bp cut. Refinitiv estimates July's headline PCE price index to rise by 0.2% month-on-month, up from 0.1% prior.
US PCE price index chart
![US PCE price index chart](http://a.c-dn.net/c/content/dam/publicsites/igcom/au/images/News-and-articles/UScore23aug.png/jcr:content/renditions/original-size.webp)
-
CN
NBS manufacturing PMI
Saturday, 31 August at 11.30am AEST
China’s official PMI figures have struggled to show significant improvement, indicating a subdued growth outlook for the world’s second-largest economy. In July, manufacturing activity remained in contraction for the third consecutive month at 49.4, while non-manufacturing PMI edged lower to 50.2, its lowest level since November 2023.
The Caixin PMI, which focuses more on small and medium-sized enterprises (SMEs), also disappointed, showing an unexpected contraction in the manufacturing sector, although services performed slightly better.
In July, China surprised markets by cutting major short and long-term interest rates, as weaker-than-expected economic data raised further doubts about meeting their 5% growth target for this year. Little is expected from the upcoming PMI data, but with services PMI nearing contractionary levels, a broad-based contraction in economic activity could increase calls for further action by authorities to stabilise growth.
CN NBS manufacturing PMI chart
![CN NBS manufacturing PMI chart](http://a.c-dn.net/c/content/dam/publicsites/igcom/au/images/News-and-articles/CNpmi23aug.png/jcr:content/renditions/original-size.webp)
![US Q2 2024 earnings chart](http://a.c-dn.net/c/content/dam/publicsites/igcom/au/images/News-and-articles/earn2308.png/jcr:content/renditions/original-size.webp)
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
![](http://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/ContentImage/Forex global component NA banner.jpg/jcr:content/renditions/original-size.webp)
Start trading forex today
Trade the largest and most volatile financial market in the world.
- Spreads start at just 0.6 points on EUR/USD
- Analyse market movements with our essential selection of charts
- Speculate from a range of platforms, including on mobile
Live prices on most popular markets
- Forex
- Shares
- Indices