The markets month ahead: key events for your trading diary in October

Get a look at the coming month’s important market-moving events with our October trading preview. 

Economic events to watch in October 

OPEC-JMMC meetings – Monday 4th October  

The month begins in earnest with OPEC-JMMC meetings. OPEC+ comes together for its monthly policy talks. No shocking surprises are expected this month. Instead, we’ll probably see a rubber-stamping of the planned output increase of 400,000 bpd.  

RBA rate statement – Tuesday 5th October  

The Reserve Bank of Australia releases its newest rate statement at the start of the month. Markets forecast no hike for the foreseeable future. The cash rate will probably stay at its historic low. 

RBNZ rate statement – Wednesday 6th October  

Joining its Australian cousin in starting the month with a rate decision is the Reserve Bank of New Zealand. Economists think an increase in the 0.2% cash rate will come – but not the 0.5% increase forecast. 

US nonfarm payrolls – Friday 8th October 

Jerome Powell and the Fed, plus the wider markets, will be watching the month’s NFP data carefully. August’s data missed the mark by miles – will September’s stats point towards a US labour market surge? 

US CPI data – Wednesday 13th October 

Consumer Price Index rises cooled in August, backing the Fed’s stance that current high prices are all transitionary. Month-on-month price gains slowed to 0.3%. September’s CPI stats are released on Wednesday 13th of October. 

US retail sales data – Friday 15th October 

Retail sales across America picked up an unexpected bump in August. Sales were up 0.7% according to the Census Bureau. Observers were calling for a 0.7% decline, driven by rising Delta-variant COVID cases. Will we see an upward swing in September too? 

UK CPI data – Tuesday 20th October 

UK inflation is running hot. Last month’s report showed it growing at the fastest rate since records began, rising at 3.2%. It may be all transitionary, but if inflation punches above the Bank of England’s 4% target, then the UK’s central bank may be forced to act. 

European PMIs – Friday October 22nd 

Brace for the monthly European flash PMI blitz with all the key economic activity indicators from France, Germany, and the EU all inbound. Eurozone composite PMI readings for September missed expectations of 58.5 coming in at 56.1. Still in growth, but it looks like activity is starting to slow. 

Bank of Canada rate statement – Wednesday October 27th 

The first rate statement of Justin Trudeau’s third term comes this month. Governor Tiff Macklem and co. stuck to their guns in September, keeping the 0.25% rate in place and the QE pace the same. It’s probable October’s statement will bring much the same. 

ECB Press Conference – Thursday October 28th  

The European Central Bank scaled back its bond-buying programme in September in a bid to cool soaring inflation. Its October moves will likely all come down to how EU CPI reacted to the change. Rates stayed at 0% and it’s likely they will in the mid-term. 

Major economic data 

Date  Time (GMT+1)  Asset  Event 
Mon Oct-04  8:00am  EUR  Spanish Unemployment Change 
  All Day  All  OPEC Meetings 
  All Day  All  OPEC-JMMC Meetings 
       
Tue Oct-05  4:30am  AUD  RBA Rate Statement 
  4:30am  AUD  Cash Rate 
  Tentative  JPY  BOJ Gov Kuroda Speaks 
  3:00pm  USD  ISM Services PMI 
       
Wed Oct-06  2:00am  NZD  Official Cash Rate 
  2:00am  NZD  RBNZ Rate Statement 
  1:15pm  USD  ADP Non-Farm Employment Change 
  3:30pm  OIL  Crude Oil Inventories 
       
Thu Oct-07  1:30pm  USD  Unemployment Claims 
  3:00pm  CAD  Ivey PMI 
       
Fri Oct-08  1:30am  AUD  RBA Financial Stability Review 
  1:30pm  CAD  Employment Change 
  1:30pm  CAD  Unemployment Rate 
  1:30pm  USD  Average Hourly Earnings m/m 
  1:30pm  USD  Non-Farm Employment Change 
  1:30pm  USD  Unemployment Rate 
  Tentative  USD  Treasury Currency Report 
       
Tue Oct 12  3:00am  CNH  GDP q/y 
  3:00am  CNH  Retail Sales y/y 
  10:00am  EUR  ZEW Economic Sentiment 
  10:00am  EUR  German ZEW Economic Sentiment 
  3:00pm  USD  JOLTS Job Openings 
  6:00pm  USD  10-y Bond Auction 
       
Wed Oct-13  1:30pm  USD  CPI m/m 
  1:30pm  USD  Core CPI m/m 
  6:01pm  USD  30-y Bond Auction 
  7:00pm  USD  FOMC Meeting Minutes 
       
Thu Oct-14  1:30am  AUD  Employment Change 
  1:30am  AUD  Unemployment Rate 
  1:30pm  USD  PPI m/m 
  1:30pm  USD  Core PPI m/m 
  1:30pm  USD  Unemployment Claims 
  4:00pm  OIL  Crude Oil Inventories 
       
Fri Oct-15  7:00am  GBP  Retail Sales m/m 
  1:30pm  USD  Core Retail Sales m/m 
  1:30pm  USD  Retail Sales m/m 
  1:30pm  USD  Empire State Manufacturing Index 
  3:00pm  USD  Prelim UoM Consumer Sentiment 
       
Mon Oct-18  2:15pm  USD  Industrial Production m/m 
  3:30pm  CAD  BOC Business Outlook Survey 
Tue Oct-19  1:30am  AUD  Monetary Policy Meeting Minutes 
       
Wed Oct-20  7:00am  GBP  CPI y/y 
  1:30pm  CAD  CPI m/m 
  1:30pm  CAD  Common CPI y/y 
  1:30pm  CAD  Core Retail Sales m/m 
  1:30pm  CAD  Median CPI y/y 
  1:30pm  CAD  Retail Sales m/m 
  1:30pm  CAD  Trimmed CPI y/y 
  3:30pm  OIL  Crude Oil Inventories 
  10:45pm  NZD  CPI q/q 
       
Thu Oct-21  1:30pm  USD  Philly Fed Manufacturing Index 
  1:30pm  USD  Unemployment Claims 
       
Fri Oct-22  8:15am  EUR  French Flash Manufacturing PMI 
  8:15am  EUR  French Flash Services PMI 
  8:30am  EUR  German Flash Manufacturing PMI 
  8:30am  EUR  German Flash Services PMI 
  9:00am  EUR  Flash Manufacturing PMI 
  9:00am  EUR  Flash Services PMI 
  9:30am  GBP  Flash Manufacturing PMI 
  9:30am  GBP  Flash Services PMI 
  2:45pm  USD  Flash Manufacturing PMI 
  2:45pm  USD  Flash Services PMI 
       
Mon Oct-25  9:00am  EUR  German ifo Business Climate 
       
Tue Oct-26  1:30pm  USD  Core Durable Goods Orders m/m 
  1:30pm  USD  Durable Goods Orders m/m 
  3:00pm  USD  CB Consumer Confidence 
       
Wed Oct-27  1:30am  AUD  CPI q/q 
  1:30am  AUD  Trimmed Mean CPI q/q 
  3:00pm  CAD  BOC Monetary Policy Report 
  3:00pm  CAD  BOC Rate Statement 
  3:00pm  CAD  Overnight Rate 
  3:30pm  OIL  Crude Oil Inventories 
  Tentative  CAD  BOC Press Conference 
       
Thu Oct-28  Tentative  JPY  BOJ Outlook Report 
  Tentative  JPY  Monetary Policy Statement 
  Tentative  JPY  BOJ Press Conference 
  12:45pm  EUR  Monetary Policy Statement 
  12:45pm  EUR  Main Refinancing Rate 
  1:30pm  EUR  ECB Press Conference 
  1:30pm  USD  Advance GDP q/q 
  1:30pm  USD  Advance GDP Price Index q/q 
  1:30pm  USD  Unemployment Claims 
  3:00pm  USD  Pending Home Sales m/m 
       
Fri Oct-29  8:00am  EUR  German Prelim GDP q/q 
  1:30pm  CAD  GDP m/m 
  1:30pm  USD  Core PCE Price Index m/m 
  2:45pm  USD  Chicago PMI 
  3:00pm  USD  Revised UoM Consumer Sentiment 
Sat Oct-30  Day 1  All  G20 Meetings 
       
Sun Oct-31  1:00am  CNH  Manufacturing PMI 
  Day 2  All  G20 Meetings 

Week Ahead: FOMC minutes, global PMI rush & UK CPI/Retail sales

Week Ahead

FOMC meeting minutes are released this week for April’s meeting as pressure mounts on Jerome Powell et al to take inflation seriously.

UK CPI data gives an insight into inflation there, while the first batch of post-lockdown retail sales data lets us see if shoppers are heading back to the British high street.

There’s a wealth of PMI data coming from the UK, US, and EU too. How will their economic recoveries compare?

FOMC meeting minutes – is the time act approaching?

We get a detailed look inside the FOMC this week as it releases its minutes for its April meeting.

We know the story now. Despite acknowledging the fact inflation is probably on its way, although rising fuel-led CPI data has shown this is already case, no major tweaks are coming to the Fed’s current policy.

Chairman Jerome Powell is content with letting the economy run hot. Rates remain at near zero. QE will remain in place for the foreseeable at $120bn a month in treasury and agency mortgage-backed securities.

We’ve spoken in the past about what it will take for Powell and Co. to switch things up. According to Powell, three criteria need to be met:

• Effective complete recovery in the labour market
• Inflation reaching 2%
• Inflation running above 2% for a sustainable period of time

Employment might be key here. Eight million Americans are still out of work – although job openings have leapt above that figure. April’s NFP data was not quite as stellar as March’s blockbuster performance either.

The US economy is strengthening. First quarter GDP grew 6.4% year-on-year. We’re not out of the woods yet though, but the momentum is building – maybe it’ll force Powell’s hand in June. For now, the course is steady.

UK CPI shines inflation spotlight on UK economy

We’ll get a taste of the state of inflation in the UK this week with April’s year-on-year CPI data release.

According to May’s Monetary Policy Report, the Bank of England puts current CPI below the Monetary Policy Committee’s (MPC) target of 2.0%. However, we’ve seen indicators that inflation is coming in previous Office of National Statistics (CPI) releases.

March’s ONS CPI reading put the consumer price inflation at 0.7%, compared with 0.4% in February, and rebalancing with the 0.7% level seen in January.

Looking across the year, BoE forecasts think its 2.0% target might be hit by the end of the year. Other commentators have similar outlooks, maybe not hitting the full 2.0% level, but close to it. For instance, National Institute of Economic and Social Research (NIESR) puts year-end CPI at 1.8%, rising to 2.0% by Q2 2022.

Pantheon’s Chief UK Economist Samuel Tombs believes the 2.0% figure will come this month, with April’s printing clocking in at 1.7%. Tombs thinks, because the reading will come after shops have opened, alongside an anticipated semi-annual increase in electricity and natural gas prices, we’ll get a more accurate reading of the state of things.

First post-lockdown UK retail sales data inbound

UK retail sales data for April is coming, following preliminary data published last week.

As to be expected, with lockdown relaxing and non-essential shops open for trading again, initial sales data shows an encouraging spike across April. BRC-KPMG Retail Sales Monitor, overall retail sales in April rose 7.3% against April 2019 (when figures were unaffected by the Covid-19 pandemic).

On a like-for-like basis, sales were up 46%.

“Following the reopening of so-called non-essential stores on 12th April in England and Wales and continued online growth, retail sales enjoyed a welcome boost last month. With the short-term pent-up demand for the shopping experience drawing consumers back to stores, non-food sales across stores and online increased by a quarter between March and April,” BRC Chief Executive Helen Dickinson said.

“Many fashion retailers saw an uptick in sales, particularly in outerwear and knitwear, as the public braved the cold spring weather for outdoor meeting and dining with friends. Furniture also saw a boost as consumers can once again try before they buy,” Dickinson added.

In the three weeks following the first reopening of stores across England and Wales, overall non-food sales in the UK rose 25% against spending levels of seen in March when the lockdown was still in full effect.

Inevitably, the growth rate will slow once the retail segment fully normalises. In the short term though, the sector looks like it’s being buoyed by an expected post-lockdown surge.

Worldwide PMI rush

An avalanche of flash PMI readings are on their way. The EU reports this week, as does the UK and US.

Starting with the EU, the bloc will be hoping to build on April’s forward momentum. Services flash PMI that month hit a nine-month high, with a score of 53.7. Manufacturing was rated at 62.9 according to IHS Markit ratings.

The EU, then, may mirror the course the UK is on: GDP contraction in the first quarter, followed by growth across the year.

Looking to the UK, April saw a record increase in services PMI, reaching its highest level for seven years. March’s reading was 56.3. April’s was 61.0. The partial reopening of the hospitality sector has put it on a growth footing once more, and we may see further growth when venues allow indoor service from Monday.
IHS Markit’s April manufacturing PMI for the UK also showed very strong performance, after nudging record highs. The index rose to 60.9 over 58.9 for March. Growth is back in the sector as orders pick up, but IHS did flag supply chain delays and input issues that could affect ongoing performance.

While the EU and UK look to grow, US manufacturing might be taking a step back. April’s ISM manufacturing PMI data came in at 60.7 – far lower than the expected 65. Supply chain woes are holding the sector back, according to ISM.

We’ll get further information on the economic health of these key industries with the week’s PMI releases.

Major economic data

Date Time (GMT+1) Currency Event
Tue 18-May 2.30am AUD Monetary Policy Meeting Minutes
 
Wed 19-May 7.00am GBP CPI y/y
  1.30pm CAD CPI m/m
  3.30pm USD US Crude Oil Inventories
  7.00pm USD FOMC Meeting Minutes
 
Thu 20-May 2.30am AUD Employment Change
  2.30am AUD Unemployment Rate
  1.30pm USD Phily Fed Manufacturing Index
  1.30pm USD Unemployment Claims
  3.30pm USD US Natural Gas Inventories
 
Fri 21-May 2.30am AUD Retail Sales m/m
  3.00am NZD Annual Budget Release
  7.00am GBP Retail Sales m/m
  8.15am EUR French Flash Manufacturing PMI
  8.15am EUR French Flash Services PMI
  8.30am EUR German Flash Manufacturing PMI
  8.30am EUR German Flash Services PMI
  9.00am EUR Flash Manufacturing PMI
  9.00am EUR Flash Services PMI
  9.30am GBP Flash Manufacturing PMI
  9.30am GBP Flash Services PMI
  1.30pm CAD Core Retail Sales m/m
  1.30pm CAD Retail Sales m/m
  2.45pm USD Flash Manufacturing PMI

 

Key earnings data

Date Company Event
Mon 17-May Bridgestone Q1 2021 Earnings
  Ryanair Q4 2021 Earnings
 
Tue 18-May Walmart Q2 2022 Earnings
  Home Depot Q1 2021 Earnings
  Vodafone Q4 2021 Earnings
  LG Corp Q1 2021 Earnings
  Take Two Q4 2021 Earnings
  Tata Motors Q4 2021 Earnings
 
Wed 19-May Cisco Q3 2021 Earnings
  Lowe’s Q1 2021 Earnings
  JD.com Q1 2021 Earnings
  Target Q1 2021 Earnings
  Analog Devices Q2 2021 Earnings
  Experian Q4 2021 Earnings
 
Thu 20-May Tencent Holdings Q1 2021 Earnings
  Applied Materials Q2 2021 Earnings
  National Grid PLC Q4 2021 Earnings
  Palo Alto Networks Q3 2021 Earnings
  Ralph Lauren Q4 2021 Earnings
 
Fri 21-May Deere & Co. Q2 2021 Earnings

 

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