Week 29 economic events: what to watch

From China's GDP figures to the Eurozone's inflation rate, each report holds the key to unlocking strategic trades. Keep reading to stay ahead of the curve and make informed trading decisions in the coming week.

Monday, July 15

China GDP Growth Rate Q2: July 15, 2024, 02:00 GMT

For Q2 2024, China's GDP growth is expected to slow slightly to around 4.2%. This moderation is attributed to ongoing challenges in the real estate sector and uncertainties in external demand, despite strong industrial production and manufacturing investments. Resilient exports and equipment renewal policies have been key drivers of growth. However, consumption remains weak, and there are calls for enhanced fiscal support to boost the real estate sector and overall demand.

• Previous: 4.5%
• Estimate: 4.2%

Impact: Affects global commodities (especially metals) and Chinese stocks.

US Retail Sales (MoM) June: July 15, 2024, 12:30 GMT

The upcoming US Retail Sales (MoM) data for June 2024, scheduled for release on July 15, 2024, at 12:30 GMT, is particularly critical given the recent news of mixed consumer sentiment and fluctuating employment figures. Recent reports indicate that while some sectors, such as online retail and automotive sales, have seen steady growth, others, like brick-and-mortar stores, are struggling with reduced foot traffic and cautious consumer spending. If the retail sales data reflects this uneven recovery and falls below the expected 0.2% increase, it could signal persistent weaknesses in consumer confidence, potentially leading to a depreciation of the US Dollar (USD) and increased volatility in US stock markets, especially in retail and consumer discretionary sectors. Traders should also watch for implications on the Federal Reserve's monetary policy, as weaker retail sales could bolster arguments for maintaining or even easing current interest rate levels.

• Previous: 0.3%
• Estimate: 0.2%

Impact: Influences USD, US stock indices, and consumer-focused stocks.

Tuesday, July 16

UK Unemployment Rate May: July 16, 2024, 06:00 GMT

The UK's unemployment rate for May 2024 stands at 4.4%, slightly above the previous month's 3.8%. This increase is part of a broader trend of rising unemployment over the past year. Key factors contributing to this include a decrease in payrolled employees and a slight increase in the claimant count for unemployment benefits. Despite these figures, average earnings have seen significant growth, with regular pay (excluding bonuses) increasing by 6.0% year-on-year. The ongoing challenges in the labor market, particularly the volatility in job vacancies and economic inactivity rates, suggest potential fluctuations in GBP and UK equities, particularly those tied to consumer spending and retail sectors.

• Previous: 3.8%
• Estimate: 3.8%

Impact: Affects GBP, UK stocks, and bond yields.

Germany ZEW Economic Sentiment Index July: July 16, 2024, 09:00 GMT

The Germany ZEW Economic Sentiment Index for July 2024 shows continued optimism, with the index at 47.5, up from 47.1 in May. This indicates positive future expectations among investors, despite a slight decline in the current economic situation assessment to -73.8.

• Previous: -8.5
• Estimate: -10

Impact: Influences EUR, European stocks, and bond markets.

Wednesday, July 17

Canada CPI (YoY) June: July 17, 2024, 12:30 GMT

The Consumer Price Index (CPI) for Canada in June 2024 is scheduled to be released on July 16. The CPI for May 2024 showed a year-over-year increase of 2.9%, matching April's figure and exceeding the forecast of 2.6%. This increase was driven by higher prices for services, travel, and air transportation, despite a slower decline in prices for cellular services.

• Previous: 2.9%
• Estimate: 3.4%

Impact: Affects CAD, Canadian equities, and bond yields.

US Industrial Production (MoM) June: July 17, 2024, 13:15 GMT

For June 2024, US Industrial Production data is set to be released on July 17. In May 2024, industrial production saw a significant increase of 0.9%, driven by a similar 0.9% rise in manufacturing output. This growth followed a period of decline in the previous months. The mining sector also experienced a modest increase of 0.3%, while utilities surged by 1.6%.

• Previous: 0.1%
• Estimate: 0.2%

Impact: Influences USD, US industrial stocks, and commodities.

Thursday, July 18

Australia Employment Change June: July 18, 2024, 01:30 GMT

For June 2024, Australia is expected to release its employment change data soon. In May 2024, employment increased by 39,700 jobs, exceeding the forecast of 30,000. This growth was driven by a significant rise in full-time employment. The unemployment rate dropped to 4.0% from 4.1% in April, reflecting a strengthening labor market.

• Previous: 39,700
• Estimate: 30,000

Impact: Affects AUD, Australian equities, and bond yields.

Japan Balance of Trade June: July 18, 2024, 23:50 GMT

For June 2024, Japan's trade balance data indicates a continued deficit trend. In May 2024, Japan reported a trade deficit of JPY 1,221 billion, which was an improvement from the JPY 1,382 billion deficit in the same month the previous year. This was mainly due to exports growing faster than imports, even though both saw substantial growth.

Preliminary data for the first 20 days of June 2024 also showed a persistent trade gap, driven by ongoing global economic conditions and fluctuating import costs.

• Previous: JPY 1,048 billion
• Estimate: JPY 950 billion

Impact: Influences JPY, Japanese stocks, and bond markets.

Friday, July 19

Eurozone Inflation Rate (YoY) June: July 19, 2024, 09:00 GMT

For June 2024, the Eurozone's annual inflation rate decreased to 2.5%, down from 2.6% in May. This decline aligns with economists' expectations and supports hopes for potential interest rate cuts by the European Central Bank (ECB). The main components contributing to this rate include services, which had the highest annual rate at 4.1%, followed by food, alcohol, and tobacco at 2.5%, and non-energy industrial goods at 0.7%. Energy prices slightly decreased from 0.3% in May to 0.2% in June.

• Previous: 2.6%
• Estimate: 2.5%

Impact: Affects EUR, European stocks, and bond yields.

Summary

The upcoming week offers a wealth of critical data releases that could shape market trends and trading strategies. With key insights into GDP growth, inflation rates, and employment changes from major global economies, traders have a unique opportunity to capitalize on market movements.

Stay ahead of the curve, leverage these data points, and make informed decisions to optimize your trading outcomes. Embrace the dynamic nature of the markets and turn these economic signals into strategic advantages for a successful trading week.