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Key events on Friday - Westpac

FXStreet (Bali) - Sean Callow, FX Strategist at Westpac, shares his view on the day ahead.

Key Quotes

Australia’s data calendar is limited to Jul private sector credit, a low key release ahead of next week’s very crowded slate which includes Q2 GDP, Jul retail sales, trade and building approvals plus the RBA Board meeting and a speech by Governor Stevens. Asia’s key release is India’s Q2 GDP data, seen rising to 5.5% y/y from 4.6% in Q1, which was barely above cycle lows.

Japan releases its slew of month end data starting from 9:30am Syd/7:30am Sing/HK. Most attention will be on CPI. The divergence between Tokyo’s 2.8% y/y Aug CPI and the national 3.6% y/y reading in Jul hints at the clear risks of substantially slower inflation ahead. Jul IP is also worth watching, with a bounce expected after the awful -3.4% m/m in June.

There is intense interest in the advance reading on Eurozone Aug CPI (5pm Sing/HK). The median forecast is 0.3% y/y versus 0.4% in July, which would be a new low since Oct 2009. Although core CPI is seen steady at 0.8% y/y i.e. energy costs are weighing on the headline reading, any downside surprise would stoke talk of fresh ECB action next Thursday. EZ unemployment is also due, seen steady at 11.5% in July.

The US data calendar is busy with second tier data, though there will be interest in the core PCE deflator for July, the Fed’s preferred inflation measure. This is seen up 0.1% m/m, 1.5% y/y, unchanged from June. The Aug Chicago PMI is expected to rebound to 56.5 after its startling 10ppt drop in July. Final U Michigan consumer sentiment is also due, with an upward revision likely. Canada releases June GDP, seen up 0.2% m/m, 3.0% y/y (Q2 2.7% SAAR).

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