5 Things to Watch on the Economic Calendar This Week

In the upcoming week, market participants will be closely watching Wednesday’s release of the Federal Reserve’s minutes from its July policy meeting for insights into the timing of the next U.S. interest rate hike. U.S. inflation data will also be a focal point as investors assess whether the economy can endure rising borrowing costs in the near future.

Additionally, preliminary growth data for Japan’s second quarter will attract attention, particularly concerning recent yen strength and its implications for the nation’s economic growth prospects.

In the United Kingdom, traders will be anticipating reports on employment, consumer prices, and retail sales to further understand the ongoing impact of the Brexit decision on the economy. Meanwhile, a report on German business confidence will be scrutinized for indications of the health of Europe’s largest economy following the Brexit vote.

Ahead of the week, here are five significant economic events that are expected to influence the markets:

1. Federal Reserve FOMC Meeting Minutes
   The Federal Reserve is set to release its meeting minutes on Wednesday at 18:00 GMT (2:00 PM ET). Investors are seeking clarity on the central bank’s stance regarding future interest rate hikes. Following the Fed’s July meeting, interest rates were kept unchanged, and the Fed acknowledged that near-term risks to the U.S. economy had diminished, but did not indicate an imminent rate increase. Currently, futures markets suggest a 9% chance of a rate hike by September, with December odds at around 45%.

2. U.S. Inflation Data for July
   The Commerce Department will publish the July inflation figures on Tuesday at 12:30 GMT (8:30 AM ET). Market analysts expect a minor increase of 0.1% in the overall inflation rate, while core inflation, which excludes food and energy prices, is projected to rise by 0.2%. Year-over-year, core prices are anticipated to climb to 2.3%. The Federal Reserve closely monitors core inflation, typically maintaining a target of 2% or lower, and increasing inflation could prompt a rate hike.

3. Japan’s Second Quarter Preliminary GDP
   Japan will release its preliminary GDP report on Sunday at 23:50 GMT (7:50 PM ET). Expectations suggest that Japan’s economy expanded by only 0.2% during the April-June period, placing pressure on policymakers to bolster the economy.

4. U.K. CPI, Employment, and Retail Sales Data
   The U.K. Office for National Statistics (ONS) will publish consumer price inflation data for July on Tuesday at 08:30 GMT (4:30 AM ET), with analysts forecasting a 0.5% rise following a similar increase the previous month. On Wednesday at the same time, the ONS will release July’s employment report, anticipated to show a 10,000 increase in jobs while keeping the unemployment rate steady at 4.9%. Retail sales data is expected on Thursday, with a forecasted increase of 0.4% after a previous drop of 0.9%. The Bank of England recently made significant interest rate cuts and introduced new easing measures to mitigate potential economic downturns resulting from Brexit uncertainties.

5. German ZEW Business Survey
   The ZEW Institute is scheduled to publish its business survey on Tuesday at 09:00 GMT (5:00 AM ET). Expectations indicate a rebound to a reading of 2.0 from July’s -6.8, while the economic sentiment index is forecasted to increase slightly to 50.0 from 49.8.

These events are poised to have substantial effects on the economic landscape and market movements in the week ahead.