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The upcoming week focuses on employment and GDP reports. Australia and the UK release key job numbers and the UK will release GDP numbers for Q2 and June. As well, the US releases consumer inflation and retail sales numbers.

Japan’s GDP posted a third straight decline in GDP, with a reading of 0.6% in Q2. Two consecutive declines indicate that the economy is a recession. In Canada, the economy created an impressive 418.5 thousand jobs, beating the estimate of 395.0 thousand. The unemployment rate fell to 10.9%, down from 12.3% beforehand. Eurozone manufacturing PMIs were within expectations in July, with readings above the 50 level, which indicates expansion. German and the eurozone PMIs came in at 51.0 and 51.8, respectively.

There were no surprises from the Bank of England, which held rates at 0.10% in a unanimous decision. The Reserve Bank of Australia held rates at 0.25%, where it has been pegged since March. The bank’s rate statement noted that although the worst of the global contraction has now passed, the economic outlook remains highly uncertain.

There was good news from the US manufacturing sector, as the ISM Manufacturing PMI improved to 54.2 in June, up from 53.6 beforehand. A reading above the 50-level points to expansion. US employment data was stronger than expected. Nonfarm payrolls slowed to 1.76 million, down from 4.8 million beforehand. Still, this beat the forecast of 1.53 million. Wage growth beat the estimate of -0.5% with a gain of 0.2%, after two straight declines. As well the unemployment rate fell from11.1% to 10.2%, beating the estimate of 10.5%.
  1. UK Employment Report: Tuesday, 6:00. Unemployment rolls fell by 28 thousand, after a huge gain of 528.9 thousand beforehand. We now await the July data. Wage growth has fallen for four successive months and declined by 0.3% in May. Analysts are braced for another decline, with an estimate of -1.2%. The unemployment rate has been pegged at 3.9% for three straight readings, but is projected to rise to 4.2%.
  2. US Inflation Report: Wednesday, 12:30. CPI gained 0.6% in June, ending a nasty streak of three successive declines. The estimate for July stands at 0.3%. The core read of 0.2% also came after three straight declines. The forecast for the July estimate is 0.2%.
  3. UK GDP: Wednesday, 6:00. The UK releases both quarterly and monthly GDP releases. In Q1, GDP declined by 2.0%, reflecting the economic toll from Covid-19. Investors are braced for a huge drop of 20.5% in Q2, which could rattle the British pound. In May, the economy gained 1.8%, well shy of the forecast of 5.5%. The estimate for June stands at 8.1%.
  4. US Retail Sales: Wednesday, 12:30. Retail sales posted a gain of 7.5% after a huge gain of 17.7%. Core retail sales have also looked sharp, with gains of 12.4% in May and 7.3% in June.
  5. Australia Employment Report: Thursday, 1:30. Job creation rebounded in June, with a reading of 210.8 thousand. This follows a loss of 227.7 thousand jobs in May. The July gain is expected to be much smaller, at 30.0 thousand.   The unemployment rate shot up to 7.4% in June, up from 7.1% a month earlier. Analysts are braced for a rise to 7.8% in July.
  6. German Final CPI: Thursday, 6:00. German inflation improved to 0.6% in June, up from -0.1% beforehand. The forecast for July stands at -0.5%.
  • All times are GMT

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