24 February 2020
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Australia: Jobs and wages data dominate

Craig James
14 February 2020

On Tuesday

On Tuesday, ANZ and Roy Morgan issue the consumer sentiment index for the week ended February 16. And the Bureau of Statistics (ABS) releases tourism and migration data in the Overseas Arrivals and Departures publication for December. Tourist arrivals rose by 0.6% in November with departures up by a stronger 2.8% to record highs. It was the biggest lift in tourist departures in six months. 

Also, on Tuesday, the Reserve Bank issues the minutes of its February 4 policy meeting. A deluge of Bank communication last week reinforced the notion that the Board are reluctant interest rate cutters. Policymakers appear more confident that an improvement in job hiring surveys and lower unemployment will ‘buy it more time.’ But downside risks from weaker Chinese demand and sluggish domestic demand suggest otherwise. Absent any additional Federal government fiscal initiatives, Commonwealth Bank (CBA) Group economists have pencilled in another interest rate cut in April.

On Wednesday

On Wednesday the Department of Employment, Skills, Family and Small Business releases skilled internet job vacancies data. Vacancies rose by 0.6% in December – the biggest lift in 22 months. Economists will be on the lookout for any signs of a slowing of hiring due to the bushfire crisis. Also, on Wednesday, the ABS issues the Wage Price Index (WPI). CBA Group economists forecast the WPI to lift by 0.6% to a 2.3% annual growth rate in the December quarter. 

On Thursday

On Thursday, the all-important jobs report for January is issued. The unemployment rate is expected to remain steady at 5.1% – due to a lower participation rate – with 5,000 jobs added. Also, on Thursday, the ABS’ average weekly earnings figures are released, providing dollar estimates of wages in the economy. And annual business counts data are also released to June 30th, 2019.

On Friday

On Friday, the CBA/IHS Markit issue ‘flash’ February factory and services gauges indexes.

Overseas: US Federal Reserve meeting minutes in focus

In the coming week in the US, the Federal Reserve Board January 28-29 meeting minutes are issued with regional manufacturing gauges, housing market and consumer sentiment readings. China home prices are due.

On Monday

The week kicks off in China on Monday with the release of new home price data for 70 mainland cities’ in December. That said, the coronavirus ‘lockdown’ is impacting surveying and the scheduling of data releases.

On Tuesday

On Tuesday in the US, the Federal Reserve Bank of New York releases the January Empire State reading of manufacturing activity. Capital flows data is also expected. Also, on Tuesday, the National Association of Homebuilders (NAHB) Housing Market Index is released. Confidence is expected to remain near cycle highs in February due to better affordability and low mortgage rates. The regular weekly reading on US chain store sales is also due.

On Wednesday

On Wednesday, the Mortgage Bankers Association releases weekly data on mortgage applications with producer prices, building permits and housing starts data. Starts are expected to fall by 13.6% in January. Also, on Wednesday, the Federal Reserve January 28-29 policy meeting minutes are expected to confirm that US interest rates are likely to remain on hold in the near-term. But international developments (coronavirus), slowing consumer spending and persistently low inflation present downside risks to the US economic outlook.

On Thursday

On Thursday, the regular weekly data on claims for unemployment insurance (jobless claims) is issued with the Philadelphia Fed February regional business activity index and the Conference Board leading index for January.

In China on Thursday the People’s Bank of China will determine the key loan prime rate.

On Friday

And on Friday in the US, data on existing home sales is due. Existing home sales rose by 3.6 per cent in December – the fastest pace in nearly two years – as ultra-low mortgage rates attract home buyers, despite still low housing inventory.

Also, on Friday, the IHS-Markit preliminary February readings on factory and services activity across the developed world will be closely observed. A pickup in sentiment from the US-China trade truce is likely to be overshadowed by the disruption in transportation and supply chains from the Covid19 coronavirus outbreak.

Financial markets: Australian corporate reporting season

The Australian corporate reporting season reaches its apex in the week ahead.

On Monday

Companies reporting on Monday include Bendigo & Adelaide Bank, Altium, GWA Group, QBE Insurance and Brambles.

On Tuesday

On Tuesday: BHP, Coles, IOOF, Cochlear, Ansell, Emeco, OZ Minerals, Monadelphous, Virtus Health.

On Wednesday

On Wednesday: Wesfarmers, Fortescue Metals, Nearmap, Webjet, Tabcorp, Crown Resorts, Domino's Pizza, Seven Group, WiseTech Global, Stockland, Sonic Healthcare.

On Thursday

On Thursday: Domain, Whitehaven Coal, Iluka, Super Retail Group, Coca-Cola Amatil, LendLease, Sydney Airport, Qantas, Santos, Medibank, Boral, Perpetual, Origin Energy, IRESS.

On Friday

On Friday: Inghams, Adairs, Ardent Leisure, Mayne Pharma.

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