The Week Ahead: Highlights

Asia-Pacific Preview

Purchasing Managers, Trade Reports to Show US-Iran War Effects

By Brian Jackson, Econoday Economist

The main focus of Asia-Pacific data will be the monthly PMI surveys from S&P for the region. June surveys showed the Iran conflict continued to impact activity and sentiment, while the official July PMI survey already released for China this week showed renewed contraction in both the manufacturing and non-manufacturing sectors. This could reflect further disruption to access through the Straits of Hormuz throughout the month, Strong AI-related demand, however, has supported export growth across the region and should again be evident in the PMI surveys.

Trade data from China and Taiwan will also provide information on how the Iran conflict and AI-demand is impacting regional trade flows in July, while Australia will report less timely June trade data. Taiwan is also scheduled to publish inflation data next week, as is South Korea, while Australia will publish household spending data. Quarterly labour market data for New Zealand may show some impact from recent policy tightening by the Reserve Bank of New Zealand.

Another key event will be the Reserve Bank of India policy decision. The RBIs last policy meeting was in early June, but the Iran-driven surge in fuel prices has continued to push wholesale price inflation up from 8.3 percent in April to 9.68 percent in May and 9.87 in June, its highest level since 2022.  Consumer price inflation has also risen from 3.48 percent in April to 3.93 percent in May and 4.38percent in June, its highest level since late 2024. Having left rates on hold in its last three meetings, the consensus is for no change again next week, but officials may provide some guidance on the extent to which they consider stronger price pressures will persist.

US Preview

Monthly Employment Report is Key Market Focus

By Theresa Sheehan, Econoday Economist

All eyes will be on the monthly employment report for July at 8:30 ET on Friday. The summer months can be difficult to forecast and subject to some large revisions. The vacation period can affect reporting. However, the survey reference period for July was 5 weeks and ended on July 18. This should allow data gathering to include those hired early in the month. One factor affecting the July data may be the hiring of temporary workers in June and July in the run up to the 250^th anniversary celebrations of the Declaration of Independence in the first week of July. Most of these will still be counted on payrolls early in the month but will fall off when September comes around. This means that the core industries hiring should be more visible in July. Once more the healthcare sector is likely to take the lead.

While the ADP count of private payrolls is not a predictor of the BLS data, the July 28 report put payrolls for July for the fourth week at up 15,000. The full month of July is set for release at 8:15 ET on Wednesday. The final reading is going to be down from the 98,000 increase in June and 122,000 in May. Concerns about weaker job increase will be on the rise. On the other hand, the Challenger report for job cut intentions in in July at 5:00 ET on Thursday could well show the business are not reducing current jobs amid lower labor supply, so unemployment rates could remain low.

Historically, the July payroll headline has a slightly greater tendency to come in below expectations but is about as likely to be subsequently revised higher as it is to be revised lower.

The Week Ahead: Econoday Consensus Forecasts

Monday

China PMI Manufacturing for July (Mon 0945 CST; Mon 0145 GMT; Sun 2145 EDT)

Consensus Forecast, Index: 52.0

Consensus Range, Index: 51.2 to 52.1

The index is expected to edge up to 52.0 in July from 51.7 in June, suggesting continued modest expansion in business activity.

Germany Retail Sales for June (Mon 0800 CEST; Mon 0600 GMT; Mon 0200 EDT)

Consensus Forecast, M/M: -0.2%

Consensus Range, M/M: -0.5% to 0.4%

The consensus sees retail sales retracing by 0.2 percent on the month in June after surging by 1.1 percent in May.

France PMI Manufacturing Final for July (Mon 0850 CEST; Mon 0650 GMT; Mon 0250 EDT)

Consensus Forecast, Index: 50.0

Consensus Range, Index: 50.0 to 50.0

The consensus looks for no revision in the final July report from the flash at 50.0, down from 51.2 in the June final.

Germany PMI Manufacturing Final for July (Mon 0955 CEST; Mon 0755 GMT; Mon 0355 EDT)

Consensus Forecast, Index: 52.2

Consensus Range, Index: 52.2 to 52.2

The consensus looks for no revision in the final July report from the flash at 52.2, up from 50.3 in the June final.

Eurozone PMI Manufacturing Final for July (Mon 1000 CEST; Mon 0800 GMT; Mon 0400 EDT)

Consensus Forecast, Index: 52.0

Consensus Range, Index: 52.0 to 52.0

Forecasters see no revision in the final July report from the flash at 52.0 versus 51.4 in the June final.

UK PMI Manufacturing Final for July (Mon 0930 BST; Mon 0830 GMT; Mon 0430 EDT)

Consensus Forecast, Index: 52.8

Consensus Range, Index: 52.8 to 52.8

The consensus looks for no revision in the final July report from the flash at 52.8, almost flat from 52.5 in the June final.

US PMI Manufacturing Final for July (Mon 0945 EDT; Mon 1345 GMT)

Consensus Forecast, Index: 53.8

Consensus Range, Index: 53.8 to 54.0

The consensus looks for no revision in the final July report from the flash at 53.8, almost flat from 53.9 in the June final.

US ISM Manufacturing Index for July (Mon 1000 EDT; Mon 1400 GMT)

Consensus Forecast, Index: 54.0

Consensus Range, Index: 52.8 to 57.0

Another pretty good reading at 54.0 is expected, up from 53.3 in June. Shows remarkable resilience and steadiness given all the uncertainty around commodities prices and supplies and ongoing tariff effects.

US Construction Spending for June (Mon 1000 EDT; Mon 1400 GMT)

Consensus Forecast, M/M: 0.3%

Consensus Range, M/M: 0.1% to 0.6%

Forecasters expect another garden variety 0.3 percent increase in spending for June on the month after a smaller 0.1 percent gain in May.

Tuesday

South Korea CPI for July (Tue 0800 KST; Mon 2300 GMT; Mon 1900 EDT)

Consensus Forecast, M/M: 0.2%

Consensus Range, M/M: 0.0% to 0.3%

Consensus Forecast, Y/Y: 3.2%

Consensus Range, Y/Y: 3.0% to 3.3%

The consensus looks for pretty stable inflation with CPI up 0.2 percent on month and 3.2 percent on year in July after increases of 0.1 percent and 3.2 percent, respectively, in June.

Australia House Spending for June (Tue 1130 AEST; Tue 0130 GMT; Mon 2130 EDT)

Consensus Forecast, M/M: 0.2%

Consensus Range, M/M: -0.4% to 1.2%

A slower 0.2 percent increase is expected on the month for June after a 1.3 percent rise in May.

US Motor Vehicle Sales for July (Any Time)

Consensus Forecast, Total Vehicle Sales - Annual Rate: 16.3 M

Consensus Range, Total Vehicle Sales - Annual Rate: 16.3 M to 16.8 M

Sales expected slower at 16.3 million unit rate in July versus 16.5 million in June.

Canada Merchandise Trade for June (Tue 0830 EDT; Tue 1230 GMT)

Consensus Forecast, Balance: C$3.0 B

Consensus Range, Balance: C$1.8 B to C$3.0 B

The surplus is expected to shrink to C$3.0 billion in June from C$4.243 billion in May.

US International Trade in Goods and Services for June (Tue 0830 EDT; Tue 1230 GMT)

Consensus Forecast, Balance: -$73.0 B

Consensus Range, Balance: -$75.1 B to -$70.0 B

The trade gap is seen down to $73 billion from $77.6 billion in May.

US Factory Orders for June (Tue 1000 EDT; Tue 1400 GMT)

Consensus Forecast, M/M: 0.4%

Consensus Range, M/M: -1.0% to 0.6%

A small 0.4 percent increase is the call for June after dropping 1.3 percent in May.

US JOLTS for June (Tue 1000 EDT; Tue 1400 GMT)

Consensus Forecast, Job Openings: 7.35 M

Consensus Range, Job Openings: 7.20 M to 7.57 M

A 7.35 million unit rate of job openings is the call for June, down from 7.59 million in May

Wednesday

China PMI Composite for July (Wed 0945 CST; Wed 0145 GMT; Tue 2145 EDT)

Consensus Forecast, Services Index: 53.9

Consensus Range, Services Index: 53.7 to 54.0

The consensus looks for 53.9 for July, pretty flat from versus 54.1 in June.

India Reserve Bank of India Announcement (ANYTIME)

Consensus Forecast, Change: 0 bp

Consensus Range, Change: 0 bp to 0 bp

Consensus Forecast, Level: 5.25%

Consensus Range, Level: 5.25% to 5.25%

The consensus sees no rate change this time. Markets will watch for guidance on when the RBI might feel obliged to address its imported inflation problem.

France Industrial Production for June (Wed 0845 CEST; Wed 0645 GMT; Wed 0245 EDT)

Consensus Forecast, M/M: 0.3%

Consensus Range, M/M: -0.6% to 0.8%

Forecasters expect a moderate 0.3 percent increase in output on the month to recover the 0.3 percent decrease in May.

France PMI Composite Final for July (Wed 0850 CEST; Wed 0650 GMT; Wed 0250 EDT)

Consensus Forecast, Composite Index: 49.6

Consensus Range, Composite Index: 49.6 to 49.6

Consensus Forecast, Services Index: 49.8

Consensus Range, Services Index: 49.8 to 49.8

The forecast calls for no revision for the composite or services index from the flash at 49.6 and 49.8, respectively, for July. That would be up from 47.2 and 46.8 in June.

Germany PMI Composite Final for July (Wed 0955 CEST; Wed 0755 GMT; Wed 0355 EDT)

Consensus Forecast, Composite Index: 51.2

Consensus Range, Composite Index: 51.2 to 51.2

Consensus Forecast, Services Index: 49.6

Consensus Range, Services Index: 49.6 to 49.6

The forecast calls for no revision for the composite or services index from the flash at 51.2 and 49.6, respectively, for July. That would be up from 49.5 and 48.6 in June, respectively.

Eurozone PMI Composite Final for July (Wed 1000 CEST; Wed 0800 GMT; Wed 0400 EDT)

Consensus Forecast, Composite Index: 51.9

Consensus Range, Composite Index: 51.9 to 51.9

Consensus Forecast, Services Index: 51.6

Consensus Range, Services Index: 51.6 to 51.6

The forecast calls for no revision for the composite or services index from the flash at 51.9 and 51.6, respectively, for July. That would be up from 50.0 and 49.4 in June, respectively.

UK PMI Composite Final for July (Wed 0930 BST; Wed 0830 GMT; Wed 0430 EDT)

Consensus Forecast, Composite Index: 52.1

Consensus Range, Composite Index: 52.1 to 52.1

Consensus Forecast, Services Index: 51.8

Consensus Range, Services Index: 51.8 to 51.8

The forecast calls for no revision for the composite or services index from the flash at 52.1 and 51.8, respectively, for July. That would be up a lot from 49.3 and 48.8 in June, respectively.

Eurozone PPI for June (Wed 1100 CEST; Wed 0900 GMT; Wed 0500 EDT)

Consensus Forecast, Y/Y: 4.8%

Consensus Range, Y/Y: 4.5% to 5.5%

PPI expected up 4.8 percent on year in June, down from 5.9 percent in May.

US ADP Employment Report for July (Wed 0815 EDT; Wed 1215 GMT)

Consensus Forecast, Private Payrolls - M/M: 75K

Consensus Range, Private Payrolls - M/M: 62K to 100K

Private payrolls are expected up a moderate 75K in July, down from 98K in June.

US PMI Composite Final for July (Wed 0945 EDT; Wed 1345 GMT)

Consensus Forecast, Composite Index: 53.6

Consensus Range, Composite Index: 53.6 to 53.6

Consensus Forecast, Services Index: 53.6

Consensus Range, Services Index: 53.6 to 53.6

The composite and services PMI are both expected unrevised at 53.6 in the July final from the flash. That would be up from 51.9 for composite and 51.2 for services in the June final.

US ISM Services Index for July (Wed 1000 EDT; Wed 1400 GMT)

Consensus Forecast, Index: 54.3

Consensus Range, Index: 53.8 to 55.5

Services seen barely higher at 54.3 in July from 54.0 in June.

Brazil Selic rate for August (Wed 1830 BRT; Wed 2130 GMT; Wed 1730 EDT)

Consensus Forecast, Change: -25 bp

Consensus Range, Change: -25 bp to 0 bp

Consensus Forecast, Level: 14.00%

Consensus Range, Level: 14.00% to 14.25%

The consensus looks for a fourth consecutive rate cut to combat a slowing economy as inflation pressures have diminished lately even though it remains elevated.

Thursday

Australia International Trade in Goods for June (Thu 1130 AEST; Thu 0130 GMT; Wed 2130 EDT)

Consensus Forecast, Balance: - A$1.8 B

Consensus Range, Balance: -A$2.6 B to A$1.3 B

The trade balance is expected to show a deficit of A$1.8 billion compared with a deficit of A$3.018 billion in May.

Germany Manufacturing Orders for June (Thu 0800 CEST; Thu 0600 GMT; Thu 0200 EDT)

Consensus Forecast, M/M: 0.8%

Consensus Range, M/M: -1.6% to 1.0%

Consensus Forecast, Y/Y: 5.9%

Consensus Range, Y/Y: 5.8% to 6.2%

Orders are expected up 0.8 percent on the month and 5.9 percent on year in June after rising 19 percent and 6.3 percent, respectively, in May.

Italy Industrial Production for June (Thu 1000 CEST; Thu 0800 GMT; Thu 0400 EDT)

Consensus Forecast, M/M: 0.3%

Consensus Range, M/M: 0.3% to 0.5%

The consensus sees output up 0.3 percent on the month in June to recover the 0.3 percent drop in May.

Eurozone Retail Sales for June (Thu 1100 CEST; Thu 0900 GMT; Thu 0500 EDT)

Consensus Forecast, M/M: 0.1%

Consensus Range, M/M: -0.4% to 0.2%

Consensus Forecast, Y/Y: 1.0%

Consensus Range, Y/Y: 0.9% to 1.1%

Retail sales expected up 0.1 percent on month and 1.0 percent on year in June. That compares with 0.2 percent and 1.6 percent in May

US Jobless Claims for Week of August 01 (Thu 0830 EDT; Thu 1230 GMT)

Consensus Forecast, Initial Claims - Level: 201K

Consensus Range, Initial Claims - Level: 195K to 210K

Claims expected at 201K in the latest week after rising 9K to 197K last week. The 4-week moving average was last at 202.75K and it has been declining lately. If the 4-week moving average moves below 200K, it might prompt a reassessment of the labor market.

US Productivity and Costs for Second Quarter (Thu 0830 EDT; Thu 1230 GMT)

Consensus Forecast, Nonfarm Productivity - Annual Rate: 0.7%

Consensus Range, Nonfarm Productivity - Annual Rate: 0.1% to 3.0%

Consensus Forecast, Unit Labor Costs - Annual Rate: 2.2%

Consensus Range, Unit Labor Costs - Annual Rate: 0.5% to 2.7%

Productivity growth rate expected at 0.7 percent in Q2 from 0.3 percent in Q1, rather disappointing gains. Unit labor costs are seen rising at a modest 2.2 percent rate versus 1.8 percent in Q1.

Friday

Japan Household Spending for June (Fri 0830 JST; Thu 2330 GMT; Thu 1930 EDT)

Consensus Forecast, M/M: -3.7%

Consensus Range, M/M: -5.0% to -0.7%

Consensus Forecast, Y/Y: 0.1%

Consensus Range, Y/Y: -2.5% to 3.1%

Japan's real household spending is projected to edge higher from a year earlier in June after declining for the last six months. It is expected to rise 0.1 percent after slipping 0.4 percent a month earlier as spending shows signs of stabilizing despite rising persistent inflation.

Household spending in June is seen edging up from a year earlier amid mixed economic signals. New passenger car registrations picked up, along with nationwide department store sales were higher. Conversely, supermarket sales edged down as cooler-than-usual temperatures limited demand for seasonal goods, while persistently rising prices also weighed on sales. Convenience store sales also edged lower in June.

On the month, real average spending by households with two or more people is forecast to fall 3.7 percent in June after increasing 3.7 percent a month earlier. It rose 1.6% in April after falling 1.3 percent in March and rebounding 1.5 percent in February.

In May, household spending edged down as the effects of weaker automobile purchases and a decline in domestic travel were partly offset by strong demand for air conditioners.

China Merchandise Trade for July (ANYTIME)

Consensus Forecast, Balance of Trade: $107.0 B

Consensus Range, Balance of Trade: $92.0 B to $112.6 B

Consensus Forecast, Imports - Y/Y: 27.7%

Consensus Range, Imports - Y/Y: 26.8% to 33.6%

Consensus Forecast, Exports - Y/Y: 22.9%

Consensus Range, Exports - Y/Y: 17.0% to 28.6%

The trade surplus is seen lower but still enormous at $107.0 billion from an astronomical $125.8 billion in June while huge increases continue in both imports and exports from a year ago.

Germany Industrial Production for June (Fri 0800 CEST; Fri 0600 GMT; Fri 0200 EDT)

Consensus Forecast, M/M: 0.2%

Consensus Range, M/M: -1.5% to 0.5%

Output seen up a marginal 0.2 percent on the month in June after gaining 0.9 percent in May.

Germany Merchandise Trade for June (Fri 0800 CEST; Fri 0600 GMT; Fri 0200 EDT)

Consensus Forecast, Balance: E16.9 B

Consensus Range, Balance: E16.7 B to E17.2 B

The consensus sees the surplus down to E16.9 billion in June from E19.1 billion in May.

Canada Labour Force Survey for July (Fri 0830 EDT; Fri 1230 GMT)

Consensus Forecast, Employment - M/M: 18K

Consensus Range, Employment - M/M: 8K to 25K

Consensus Forecast, Unemployment Rate: 6.5%

Consensus Range, Unemployment Rate: 6.5% to 6.5%

Jobs seen up a modest 18K in July after the same number in June. No change is expected in the jobless rate at 6.5 percent in July.

US Employment Situation for July (Fri 0830 EDT; Fri 1230 GMT)

Consensus Forecast, Nonfarm Payrolls - M/M: 88K

Consensus Range, Nonfarm Payrolls - M/M: 50K to 140K

Consensus Forecast, Unemployment Rate: 4.2%

Consensus Range, Unemployment Rate: 4.2% to 4.3%

Consensus Forecast, Private Payrolls - M/M: 77K

Consensus Range, Private Payrolls - M/M: 40K to 110K

Consensus Forecast, Manufacturing Payrolls - M/M: 4K

Consensus Range, Manufacturing Payrolls - M/M: 2K to 9K

Consensus Forecast, Average Hourly Earnings - M/M: 0.3%

Consensus Range, Average Hourly Earnings - M/M: 0.3% to 0.3%

Consensus Forecast, Average Hourly Earnings - Y/Y: 3.5%

Consensus Range, Average Hourly Earnings - Y/Y: 3.5% to 3.5%

Consensus Forecast, Average Workweek: 34.3

Consensus Range, Average Workweek: 34.2 to 34.3

A moderate 88K rise in nonfarm payrolls is the call for July with no change in the jobless rate at 4.2 percent.

US Consumer Credit for June (Fri 1500 EDT; Fri 1900 GMT)

Consensus Forecast, M/M: $10.5 B

Consensus Range, M/M: $7.0 to $15.0 B

The consensus looks for a trend-like $10.5 billion increase in consumer credit outstanding in June from May.