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The first half of the year is behind us now and many will be relieved after one of the worst six months in decades for the stock market. The second half starts sedately enough with the July 4th holiday seeing US markets closed Monday, but with earnings season just around the corner there is a lot happening for traders. 

US labour market data will be the main event this week as the latest Nonfarm Payrolls report is due Friday amid the holiday-shortened week stateside. Meanwhile the Reserve Bank of Australia is expected to once again raise interest rates. 


Friday’s Nonfarm Payrolls report is the week’s highlight as markets wrestle with inflation and central banks hiking interest rates. The strength of the labour market will be important, but market focus will be just as much on the wage data. As inflation pressures persist, the worry is that a wage price spiral takes hold, which could lead to a more entrenched high inflation regime that is harder to get out of. “We may be reaching a tipping point, beyond which an inflationary psychology spreads and becomes entrenched,” the Bank for International Settlements said in its flagship reported published last week. This came as US consumer one year ahead inflation expectations rose to a record high 8% in June, from a revised 7.5% in May. Therefore, the wage component will be of great importance to market participants.  


The Reserve Bank of Australia meets on Tuesday and is expected to raise rates again, by either 25 or 50bps. Since surprising markets with a 50bps hike in June, the RBA has revised its inflation forecasts higher twice, suggesting it will be opting for another bumper hike. Governor Lowe has stressed that the bank won’t consider a 75bps, but inflation forecasts higher and retail sales stronger than expected, the likelihood of another 50bps is high. 

FOMC meeting minutes 

Minutes from the most recent Fed meeting will be parsed for clues as to where monetary policy is headed. But in reality, we are pretty sure where the Fed stands right now. “There’s a clock running here,” Chair Jay Powell said last week. “The risk is that because of the multiplicity of shocks, you start to transition into a higher-inflation regime.” 

Data may change the equation but we understand that the Fed is intent on breaking inflation even if it means a hard landing for the economy. “The process is highly likely to involve some pain, but the worse pain would be in failing to address this high inflation and allowing it to become persistent,” said Powell. 

Economic calendar 

Mon Jul 4 12:50am (BST) JPY Monetary Base y/y 
 2:00am AUD MI Inflation Gauge m/m 
 2:30am AUD ANZ Job Advertisements m/m 
  AUD Building Approvals m/m 
 7:00am EUR German Trade Balance 
 7:30am CHF CPI m/m 
 8:00am EUR Spanish Unemployment Change 
 9:30am EUR Sentix Investor Confidence 
 10:00am EUR PPI m/m 
 Tentative EUR Spanish 10-y Bond Auction 
 Tentative EUR French 10-y Bond Auction 
 All Day USD Bank Holiday 
 2:30pm CAD Manufacturing PMI 
 3:30pm CAD BOC Business Outlook Survey 
 Tentative NZD NZIER Business Confidence 
 11:30pm AUD AIG Construction Index 
Tue Jul 5 12:30am JPY Average Cash Earnings y/y 
 2:00am NZD ANZ Commodity Prices m/m 
 2:30am AUD Retail Sales m/m 
 2:45am CNH Caixin Services PMI 
 4:35am JPY 10-y Bond Auction 
 5:30am AUD Cash Rate 
  AUD RBA Rate Statement 
 7:45am EUR French Industrial Production m/m 
 8:15am EUR Spanish Services PMI 
 8:45am EUR Italian Services PMI 
 8:50am EUR French Final Services PMI 
 8:55am EUR German Final Services PMI 
 9:00am EUR Final Services PMI 
 9:30am GBP Final Services PMI 
 Tentative GBP Housing Equity Withdrawal q/q 
 10:30am GBP BOE Financial Stability Report 
  GBP FPC Meeting Minutes 
  GBP FPC Statement 
 11:00am GBP BOE Gov Bailey Speaks 
 Tentative GBP 30-y Bond Auction 
 1:30pm CAD Building Permits m/m 
 3:00pm USD Factory Orders m/m 
 Tentative NZD GDT Price Index 
 5:30pm GBP MPC Member Tenreyro Speaks 
Wed Jul 6 7:00am EUR German Factory Orders m/m 
 9:10am GBP MPC Member Pill Speaks 
 9:30am GBP Construction PMI 
 10:00am EUR EU Economic Forecasts 
  EUR Retail Sales m/m 
 Tentative EUR German 10-y Bond Auction 
 2:00pm GBP MPC Member Cunliffe Speaks 
 2:45pm USD Final Services PMI 
 3:00pm USD JOLTS Job Openings 
  USD ISM Services PMI 
 7:00pm USD FOMC Meeting Minutes 
 11:30pm AUD AIG Services Index 
Thu Jul 7 2:30am AUD Trade Balance 
 4:35am JPY 30-y Bond Auction 
 6:00am JPY Leading Indicators 
 6:45am CHF Unemployment Rate 
 7:00am EUR German Industrial Production m/m 
  GBP Halifax HPI m/m 
 8:00am CHF Foreign Currency Reserves 
 12:30pm EUR ECB Monetary Policy Meeting Accounts 
  USD Challenger Job Cuts y/y 
 1:15pm USD ADP Non-Farm Employment Change 
 1:30pm CAD Trade Balance 
  USD Unemployment Claims 
  USD Trade Balance 
 2:00pm GBP MPC Member Mann Speaks 
 3:00pm CAD Ivey PMI 
 3:30pm NAT GAS Natural Gas Storage 
 4:00pm OIL Crude Oil Inventories 
 6:00pm USD FOMC Member Bullard Speaks 
  USD FOMC Member Waller Speaks 
Fri Jul 8 12:01am GBP RICS House Price Balance 
 12:30am JPY Household Spending y/y 
 12:50am JPY Bank Lending y/y 
  JPY Current Account 
 6:00am JPY Economy Watchers Sentiment 
 7:45am EUR French Trade Balance 
 9:00am EUR Italian Industrial Production m/m 
 12:55pm EUR ECB President Lagarde Speaks 
 1:30pm CAD Employment Change 
  CAD Unemployment Rate 
  USD Average Hourly Earnings m/m 
  USD Non-Farm Employment Change 
  USD Unemployment Rate 
 3:00pm USD Final Wholesale Inventories m/m 
 4:00pm USD FOMC Member Williams Speaks 
 8:00pm USD Consumer Credit m/m 
Sat Jul 9 2:30am CNH CPI y/y 
  CNH PPI y/y 


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