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Week Ahead Economic Preview: Week Of 7 September 2020

Published 04/09/2020, 07:34
Updated 05/03/2021, 15:50
  • This quarter growth signals sought from industrial production and trade updates
  • Policy decisions in the eurozone and Malaysia
  • UK, Japan, eurozone and Russia GDP data
  • US inflation and jobless claims in focus
  • After signs from the latest business surveys that the global recovery accelerated in August as economies continued to open up after COVID-19 lockdowns, confirmation of solid starts to the third quarter will be sought from industrial production numbers for the UK, Germany, Italy and Spain, as well as trade numbers for China, Taiwan, Germany and the UK. New estimates of GDP data for Japan, Russia and the eurozone are meanwhile expected to confirm second quarter woes.

    In the US, inflation data are updated alongside labour market indicators in the form of jobless claims and job openings. There have been some signs of input cost inflation starting to pick up in the US PMI surveys, though policymakers have shifted their focus away from price stability towards sustaining the recovery, meaning it will be the labour market that likely holds most attention. The weekly jobless claims numbers in particular will be eyed for the ongoing impact of lockdowns, which were tightened on average across the US in August but are now easing again.

    In terms of policy action, the latest ECB monetary policy decision will be eagerly awaited for clues as to the possibility of further stimulus later this year amid signs of falling prices and hints of a stumbling recovery as Italy and Spain tightened lockdowns. In the UK, July's GDP data will likely show the economy surging, though recent survey data have hinted that growth could fade after the initial rebound.

    In Asia Pacific, the import and export data published for China and Taiwan will be in particular focus as recovery hopes for the region are dependent on trade flows picking up, having been curbed by pandemic supply chain disruptions and weak demand. China's inflation data, Japan's machinery orders and Indian industrial production are also notable releases. Malaysia central bank watchers meanwhile have mixed views on whether further stimulus will be announced at the forthcoming monthly meeting.

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