Market Movers
Focus continues to be on China and the oil price but comments from Jackson Hole regarding Fed policy will also be studied closely. See the full program here .
In terms of data, Germany will release preliminary CPI for August as the first euro area country. It will give insight into the impact on inflation from the continued decline in the oil price. Gasoline prices have started to follow the oil price lower, which should result in a larger drag from energy prices. On the other hand, we look for slightly higher German core inflation and based on this we expect German HICP inflation to be unchanged at 0.1% y/y in August.
US personal spending should increase 0.4% m/m in July, in line with the solid gain in retail sales and we estimate a similar 0.4% gain in personal income.
We expect a gain of 0.1% m/m in US core PCE inflation in July, taking the annual inflation rate to 1.3%. Core PCE inflation (the Fed's preferred measure of inflation) is lagging behind core CPI, which is primarily due to 1) a smaller weight for housing in core PCE than in core CPI - recall that housing inflation has been relatively high lately and 2) medical care expenses. CPI medical care is limited to out-of-pocket expenses incurred by consumers, while PCE medical care includes direct purchases by consumers and spending on behalf of consumers, such as employer-provided health insurance plans, Medicare and Medicaid.
Norwegian and Swedish retail sales. Unemployment figures for Norway. Danish confidence data and portfolio flows.
To Read the Entire Report Please Click on the pdf File Below