Market Movers ahead
- A key release in the euro area is HIPC inflation on Thursday, which we expect to show a small increase in headline inflation, while we expect core inflation to fall slightly in August.
- We expect the euro area unemployment rate to show a further decline for July.
- In the UK, this week sees the third round of Brexit negotiations between the UK and the EU kick-off. The parties are set to continue negotiations in phase 1 (divorce bill, citizen’s rights and Irish border).
- We expect PCE in the US to show a slight increase for July.
- We expect a small setback in US job growth in August, while the unemployment rate and wage growth should remain broadly unchanged.
- The US ISM manufacturing PMI on Friday is likely to also be in focus after falling back a bit in July.
- We are due to get both the official and private (Caixin) Chinese manufacturing PMI for August and we estimate a small decline in both measures.
- We expect a further increase in retail sales growth and falling unemployment rate to support our case for a continued economic recovery in Norway.
Global macro and market themes
- The global economy is seeing positive momentum…
- …and major central banks are unlikely to put significant brakes on the expansion for now.
- This should support risk assets near term and we recommend buying equities on dips.
- Expectations regarding Trump’s growth-friendly reform agenda are at a minimum and, in our view, can surprise only on the upside.
- The EUR/USD is set to range-trade near term but head for 1.30 in coming years.
