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The Week Ahead: 5 Things to Watch on the Economic Calendar

EconomyJan 01, 2017 04:46PM ET
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© Reuters. Busy week ahead: Nonfarm payrolls, Fed minutes, China manufacturing, EZ CPI, UK PMI's

Investing.com - Investors will get back to work fast when markets reopen for the new year this week, with all eyes on the monthly U.S. employment report due Friday.

Global financial markets will also focus on Wednesday’s minutes of the Federal Reserve’s December policy meeting for further hints on the future path of monetary policy.

Meanwhile, in China, market players will be looking out for data on the country's manufacturing sector, amid ongoing concerns over the health of the world's second biggest economy.

In addition, Wednesday’s euro zone inflation data will be closely watched for indications on how recent weakness in the euro and raising oil prices affected consumer prices.

Elsewhere, in the U.K., traders will focus on a trio of reports on activity in the manufacturing, construction and services sectors for further indications on the continued effect that the Brexit decision is having on the economy.

Ahead of the coming week, Investing.com has compiled a list of the five biggest events on the economic calendar that are most likely to affect the markets.

1. U.S. Jobs Report for December

The U.S. Labor Department will release its December nonfarm payrolls report at 8:30AM ET (13:30GMT) on Friday.

The consensus forecast is that the data will show jobs growth of 175,000, following an increase of 178,000 in November, the unemployment rate is forecast to inch up to 4.7% from 4.6%, while average hourly earnings are expected to rise 0.3% after falling 0.1% a month earlier.

An upbeat employment report will point to an improving economy and support the case for higher interest rates in the coming months, while a weak report would add to uncertainty over the economic outlook and push prospects of tighter monetary policy further off the table.

Besides the employment report, this week's calendar also features U.S. data on manufacturing and service sector growth, construction spending, auto sales, weekly jobless claims, factory orders as well as monthly trade figures.

2. Fed FOMC Meeting Minutes

The Federal Reserve will release minutes of its December policy meeting on Wednesday at 2:00PM ET (19:00GMT).

The U.S. central bank hiked interest rates following its meeting on December 14, in a widely expected decision, and signaled it expects to raise interest rates three times in 2017, up from the two hikes predicted in September.

There are also several Fed speakers this week, with Chicago Fed President Charles Evans, Richmond Fed President Jeffrey Lacker and Dallas Fed President Rob Kaplan all speaking on Friday.

3. Chinese Manufacturing Data for December

The Caixin manufacturing index is due at 01:45GMT Tuesday (9:45PM ET Monday). The survey is expected to inch down to 50.7 from 50.9 in the preceding month.

The official manufacturing purchasing managers' index released on Sunday dipped to 51.4 in December from 51.7 in November, slightly below the forecast for 51.5.

Anything above 50.0 signals expansion, while readings below 50.0 indicate industry contraction.

The lack of momentum in manufacturing growth continues to worry investors heading into the new year, with the yuan’s record-setting slide versus the dollar in 2016 not seen to be providing much of a boost to the sector.

4. Euro Zone Flash December Inflation Figures

The euro zone will publish flash inflation figures for December at 10:00GMT (5:00AM ET) Wednesday.

The consensus forecast is that the report will show consumer prices rose 1.0%, compared to a rise of 0.6% in November, while core prices are expected to gain 0.8%, unchanged from the prior month.

A weaker euro and rising oil prices mean that projections the European Central Bank released less than a month ago could be revised higher in 2017.

Any sign of faster consumer-price gains could spur more-hawkish ECB officials to call for a gradual exit from monetary stimulus.

The ECB extended its bond-buying program for an additional nine months in December, even as it cut back on the size of asset purchases.

5. U.K. December PMI's

The U.K. will release readings on December manufacturing sector activity on Tuesday, followed by a report on the construction sector on Wednesday and the service sector on Thursday.

The manufacturing PMI is forecast to inch down to 53.3 from 53.4 a month earlier, construction activity is expected to improve slightly to 53.0 from 52.8, while a survey on Britain's giant services sector is forecast to dip to 54.7 from 55.2 last month.

The Bank of England kept monetary policy on hold last month and reiterated that policy can respond “in either direction” to the changes in the outlook.

Stay up-to-date on all of this week's economic events by visiting: http://www.investing.com/economic-calendar/

The Week Ahead: 5 Things to Watch on the Economic Calendar

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Msa NA
Msa NA Jan 01, 2017 3:58PM GMT
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But I don't think USD/JPY it's going to be bulls
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John Robinson
John Robinson Jan 01, 2017 11:52PM GMT
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Kavika Lotomau
Kavika Jan 01, 2017 3:49PM GMT
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Thanks for the heads up!)
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