Eyes on US inflation
Next week it will be uneventful and all attention will be focused on Wednesday on US inflation in July. Analysts expect a slowdown from 9.1% to 8.7%, mainly due to the effect the decline in the price of gasoline in the United Statesthe. However, ‘core’ inflation, net of energy and food prices, is expected to accelerate since 5.9% to 6.1%. It will be important to verify whether the shelter component, which includes the prices of the real estate sector, will begin to show signs of a slowdown. China’s inflation data is also expected on Wednesday, expected to rise, although at an absolute level, consumer prices for China are expected to rise. China they travel at a much more moderate level than those of Western economies. Also France, Germany And Brazil will release inflation data in July. On the macro front, always from China, will arrive on Sunday the reading of the trade balance for July, which should record a decline in the surplus, after the sharp rise last month. In Great Brittany on Friday the preliminary data of the GDP in the second quarter, expected to decrease compared to the previous quarter. Also on Friday there Russia will disseminate the data on the GDP in the second quarter, from which it will be possible to derive the impact of the war and Western sanctions. On the monetary front, the meeting of the Mexican central bank will be held on Thursday, which is expected to raise rates by three quarters from pointcarrying them at 8.50%. Also to be monitored are the interventions of some Fed members, mostly non-voters, who will all speak after the publication of the inflation data on Wednesday.
“Everything continues to revolve around the moves of the Fed – sfold to Agi Vincenzo Bova, strategist of MtsCapitalservices – If the market expects the Fed to slow down a bit the pace on rates, the stock exchanges will rise, if instead data comes out indicating that the Fed it will be even more aggressive Bags come down. In a different context of less restrictive central banks, Friday’s positive US employment figure would have boosted equities, as it would have signaled that the US economy is strong. Instead now, the stronger the US economy, the more the Fed raises rates to curb inflation. And this means that risky assets on the markets can also bounce, as has happened in the last two weeks, but then it takes little to get them back ”. “For next week and beyond, the signals are not good for the markets – adds Bova – In the last few days, the stock exchanges had risen a lot, hoping that the Fed would slow down on rates. Then the increase in US employment in July put a stop to the rise in the stock markets. It will be important to understand how markets react to US inflation data on Wednesday. However, a very strong slowdown in prices will be needed to make the markets change their mind and make them return to growth in a stable way, also because it must be taken into account that the Fed will continue to increasingly drain liquidity from the markets. And basically we have to understand what China will do in Taiwan, where the situation is serious, because i Chinese they got really angry, even if I don’t expect bad surprises apart from some tightening of sanctions ”.
#Market #week #eyes #inflation #Russian #GDP