22 October 2020
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Australia: Budget update and Reserve Bank Governor speech

Craig James
17 July 2020

On Tuesday

The week kicks off on Tuesday, with a speech delivered by the Reserve Bank Governor, Philip Lowe, to the Anika Foundation luncheon. Prior to the new lockdown in Victoria, the Governor had been upbeat on prospects for the Australian economy. There will be much interest in the new comments by the Governor.

Also, on Tuesday, the regular weekly survey on consumer confidence is issued by ANZ and Roy Morgan. CommBank (CBA) releases the weekly measure of credit and debit card spending and monthly Household Spending Intentions (HSI) survey. And the Reserve Bank releases minutes of the Board meeting held on July 7.

On Wednesday

On Wednesday, the Australian Bureau of Statistics (ABS) releases two of its relatively ‘new’ statistics. Preliminary June data is issued on retail trade. And provisional mortality figures are released for the four months to April. Retail trade rose by a record 16.9% in May after falling by a record 17.7% in April.

On Thursday

On Thursday, the Federal Government updates the latest figures on the Budget. The Government should be in a position to provide preliminary 2019/20 financial estimates. The other major interest is in what – if any – extension is applied to key economic supports like JobKeeper. The hope is that the key job market programme is extended until the end of 2020.

Also, on Thursday, the ABS issues detailed June labour market statistics. Most interest will be in demographic and regional estimates for metrics such as employment and the unemployment rate.

On Friday

On Friday, CBA and Markit will release the ‘flash’ or preliminary July findings of a survey of purchasing managers. The services sector will be in focus.

Overseas: A mixed offering of US housing market data

No real standouts in terms of the coming week’s new US economic data. But there is a raft of housing market statistics. And the US profit reporting or earnings season cranks up a notch.

On Monday

The week kicks off on Monday when the People’s Bank of China announces the monthly fixing of is benchmark interest rates – the 1-year and 5-year loan prime rates. The last change in rates was in April.

On Tuesday

In terms of the US, the week kicks off on Tuesday, when the Chicago Federal Reserve releases its National Activity index. In May, the index bounced from a record low of minus 17.89 points to a record high of positive 2.61 points.

Also, on Tuesday the usual weekly Johnson Redbook chain store sales figures are released.

On Wednesday

On Wednesday, the Federal Housing Finance Agency (FHFA) releases May data on home prices. In April, home prices rose 0.2% to be up a healthy 5.5% over the year.

Also, on Wednesday the usual weekly data on US mortgage applications from the Mortgage Bankers Association (MBA) is issued together with June data on existing home sales. In May, home sales fell by 9.7% to a seasonally adjusted annual rate of 3.91 million units – the lowest result since October 2010.

On Thursday

On Thursday, the weekly data on new claims for unemployment insurance (jobless claims) are issued with the Conference Board Leading index and the Kansas Federal Reserve manufacturing index.

On Friday

On Friday, the IHS Markit organisation releases the ‘flash’ (or preliminary) July purchasing manager’s index. And June data on new home sales is also issued. In May, new home sales bounced 16.6% higher to a 676,000 thousand annual rate – a three-month high.

US profit-reporting season

We are at that time when US listed companies report quarterly financial results – that is, the ‘earnings’ or ‘profitreporting’ season. And the flow of results cranks up a notch in the coming week.

Amongst companies expected to report over the week:

Monday: Haliburton; IBM.

Tuesday: Coca-Cola; JetBlue Airways; Lockheed Martin; Novartis; TD Ameritrade; United Airlines; Biogen Inc; Philip Morris.

Wednesday: Hilton; Las Vegas Sands; Microsoft; Tesla; Biogen Inc; Philip Morris; eBay.

Thursday: AT&T; Dow; Kimberly Clark; Royal Caribbean; Southwest Air; Travelers; Twitter; Amazon; E*Trade; Intel; MGM Resorts; Resmed; American Airlines.

Friday: American Express; Verizon; Schlumberger; Honeywell

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