Market Movers ahead
Inflation releases in the euro area and the US are in focus this week.
In the US, PCE core inflation continued to tick upwards to 2.0% y/y in July.
In the euro area, headline inflation is set to tick lower in August, while underlying inflation continues its move upward.
Key emerging markets Turkey, Brazil, South Africa and Russia will be in focus together with the looming trade war between China and the US.
There are several interesting releases in the Scandie markets, including Danish Q2 GDP, the Business Survey indicator in Sweden and unemployment data in Norway.
Global macro and market themes
Emerging Market (EM) sentiment has been hit not only by rising USD and rates and the trade war, but also increased sanction risk from the US.
The most vulnerable economies in EM at the moment are Turkey, Argentina, Russia, Brazil and South Africa.
Contagion to other EMs should be limited unless Brazil escalates into a crisis.
After failed trade talks between China-US, we expect an escalation in the trade war in early September, which could weigh further on EM sentiment.
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