♦ UK Parliamentary Vote on Brexit – TBC
UK parliament are set to debate the Internal Market bill, a move that if proceeded with, would breach the divorce Brexit agreement signed last year. This bill would allow companies to trade ‘unhindered’ across the UK , clearly breaking the legal divorce agreement which entailed aspects such as more customs checks.
‘Boris Johnson has taken a hyper-aggressive turn in drawing up possible plans to renege on the very terms that made the Brexit deal possible in the first place, and vowing that October 15 is a negotiation deadline. Bloomberg’s normally very balanced John Authers calls Boris Johnson’s move “downright stupid”’ – John Hardy, Saxo Bank
♦ Unemployment Rate (Jul) (consensus 4.1%, previous 3.9 %) – 07:00 AM BST
♦ CPI (YoY) (Aug) (consensus 0.1%, previous 1.0 %) – 07:00 AM BST
♦ CPI (MoM) (Aug) (consensus -0.6%, previous 0.4 %) – 07:00 AM BST
UK annual CPI did beat estimates in July coming in at +1.0% versus the 0.6& expected. We could see a better than expected figure for July as Boris Johnson has pushed for back to work iniatives and job openings have started to pick up. Though the primary focus will be on the Internal market bill.
♦ Retail Sales (MoM) (Aug) (consensus 1.0%, previous 1.2 %) – 13:30 PM BST
Retail sales are expected to slip given both the expiration of the $600 weekly unemployment benefits and that fact that consumer confidence has fallen to its lowest since 2014 at 84.4. The fact that congress have failed to agree on stimulus packages for the unemployed is also likely to support a lower retail sales figure.
♦ CPI (MoM) (Aug) (consensus 0.1%, previous 0%) – 13:30 PM BST
♦ Fed Interest Rate Decision & FOMC Minutes (likely no changes to interest rates) – 19:00 PM BST
We don’t expect any major announcement during the FED minutes, rather a focus on outlining the specifics and metrics of the new Inflation targeting policy. It is likely that the recent covid-19 breakouts , across states such as California, will provoke the usual ‘worried tone’. by the FED.
“The risk of another coronavirus wave as flu season approaches has been a recurring risk theme of late. Ultimately, there is no upside for the committee to be positive at this juncture. They will continue to be cautious and, if wrong, nobody will care. Whereas if they turn positive and are wrong, it could be a disaster for credibility.” – RBC Economist
♦ GDP (QoQ) (Q2)(consensus -12.8%, previous -1.6%) – 24:45 PM BST
♦ CPI (MoM) (Aug)(consensus -0.4%, previous -0.4%) – 10:00 AM BST
♦ BOE Interest Rate Decision and minutes (cash interest rates likely to stay at 0.10%) – 12:00 AM BST
The BOE have left the door open to negative rates and recently various officials have talked about how this is a viable option. Though this is highly unlikely as pursuing this would damage the financial services sector, a key component of the UK economy.
♦ Building Permits (Aug) (consensus 1.510M, previous 1.483M) – 13:30 PM BST
♦ Initial Jobless Claims (Aug) (consensus 850k, previous 884K) – 13:30 PM BST
♦ Philadelphia Fed Manufacturing Index (Sep) (consensus 15.5, previous 17.2) – 13:30 PM BST
♦ Retail Sales (MoM) (Aug) (consensus 0.7%, previous 3.6 %) – 07:00 AM BST
Online sales continue to underpin retail sales, more notably online non-food sales jumped up to 42.4% in August. Isolated local lockdowns are also likely to weigh on retail sales this month (hence the slip in forecasts).
“Lockdown also appears to have permanently changed some consumers’ shopping habits, with online sales continuing to boom despite shops reopening in June. Meanwhile, city centre retailers continue to be devastated by low footfall and poor sales, as office workers stayed away for yet another month.” – Helen Dickinson BRC
♦ Core Retail Sales (MoM) (Jul) (consensus 0.5%, previous 15.7 %) – 13:30 PM BST