Global stocks rose this week as investors remained optimistic about recovery of the world economy. As shown below, the DAX index was the best-performing major indices followed by Nasdaq and the S&P 500. Stocks received a boost by the upbeat services and manufacturing PMI numbers from the United States, Europe, and Asia.
The positive employment numbers from the US also helped support these stocks. However, the rising number of coronavirus cases in the United States rose and some states rolled back their reopening plans. Here are the 5 things to watch out in the economic calendar in the coming week.
RBA interest rate decision (AUDUSD)
The RBA will be the only game in town next week. The bank will start its two-day meeting on Monday and conclude it on Tuesday. Analysts expect the bank to leave interest rates unchanged at 0.25%. Still, they will be watching at what Governor will say about negative interest rates. This decision comes at a time when the Australian economy is making a quick recovery. Data released this week showed that the construction sector expanded while retail sales, manufacturing PMI, and services PMIs rose sharply in June.
ISM non-manufacturing PMIs (US dollar index)
Data released this week showed that the US economy expanded in June. Manufacturing PMI and employment numbers were all better than what analysts were expecting. In the coming week, we will watch the non-manufacturing PMI numbers that will be released by the Institute of Supply Management. Analysts expect that the number rose from 45.4 to 49.5 in the previous month as the country continued to reopen.
Canadian employment numbers (USDCAD)
This week, we received positive trade numbers from Canada. The data showed that exports and imports jumped in June as the country reopened. Better, the number of new infections in the country has been falling, unlike what is happening in the United States. Therefore, analysts expect that the economy created more jobs in June. These numbers will possibly be better than the 219k that were created in the previous month. And the unemployment rate could drop to 11.9% from the previous 13.7%.
IEA monthly report (Crude oil)
The price of crude oil has been moving sideways this week as traders digest the falling inventories and the rising number of coronavirus cases in the United States. We also received news that Saudi Arabia was considering going to war with Nigeria and Angola, two serial cheaters. In the coming week, we will focus on a monthly report by the International Energy Agency (IEA). The France-based organisation will release its report on demand and supply on Friday. In addition to this, we will receive oil inventory numbers on Tuesday and Wednesday.
Household spending data from Japan (USDJPY)
On Tuesday, we will receive household spending and overtime pay data from Japan. The overtime pay number is important because it shows how busy companies are. The last number showed that this pay fell by 12.80%, which is understandable because of the sluggish business activity during the lockdown. The household spending number is important because it helps to influence inflation, which is an essential consideration in monetary policy. Analysts expect that the spending fell by more than 12% in March.