Key Events In The Week Ahead

You mean, aside from the relentless headline barrage? Why yes, in a vivid reminder of what used to happen when actual fact-based events mattered, here is a complete summary of the key events in the coming week.

From Goldman Sachs:

Last week was a week of consolidation after the short-covering rally in the two previous weeks. Range-bound price action dominated across asset classes as investors were being kept busy following the European news, while macro data continued to stabilise at low levels.

In the week ahead, this pattern of stabilising macro data and Eurozone policy meetings will continue. Of course, the focus is on the EU summit on Wednesday, though expectations are not particularly high after weeks of continued negotiations and repeat summits. After the latest meetings this weekend, the details on bank recapitalisation, PSI involvement in the Greek bailout and a leverage scheme for the EFSF remain vague. While Eurozone leaders continue their debate, the week will also deliver a batch of interesting macro data in the Eurozone. Starting with the preliminary Eurozone PMI, we also get German consumer confidence and CPI data. Italy publishes consumer confidence as well and retail sales. Finally, Italy will try to issue EUR5-6bn in bonds on Thursday and Friday, possibly the first serious test of market confidence after the Summit on Wednesday.

The potential for a substantial Dollar sell-off and notable Euro rally is clearly there. Positioning data suggests continued stretched Dollar shorts against pretty much any currency, including the Euro. A quick and convincing solution to the Eurozone crisis could therefore lead to a sharp reduction in the Eurozone risk premium. Having said this, uncertainty remains high and our base case is for "muddling through" rather than a quick and convincing Eurozone solution. Last week's modest strengthening of the CHF and the JPY may have been a warning sign that currency markets also remain skeptical. It may therefore take a bit longer before the September risk aversion moves can be unwound further.

Beyond the focus on the Eurozone, there are a number of central bank meetings this week (HUF, CAD, NZD, SEK, JPY, INR, ILS, RUB), with only the RBI expected to tighten monetary policy in India, as inflation pressures remain high.

Finally, in the US, third-quarter GDP and durable goods orders will likely be the key focus.

Monday 24th

Euro-zone Oct flash PMIs: Consensus expects the manufacturing PMI to fall by 0.4 to 48.5.

HSBC China Flash PMI: The last reading stood at 49.9. The latest one just printed at 51.1

Also Interesting: Fed Dudley speech, Israel monetary policy meeting is expected to leave rates unchanged.

Tuesday 25th

Germany Consumer Confidence: Consensus expects a virtually unchanged reading at 5.1.

Italy consumer confidence and retail sales: Given the focus on Italian debt sustainability in the market, retail sales and consumer sentiment may provide indications about cyclical strength. Consensus expects basically unchanged numbers.

Hungary MPC meeting: We and consensus expect rates to stay on hold at 6.0%.

BoC policy meeting: Consensus expects no change from 1.00%.

US Oct Consumer Confidence: Consensus expects 46 after 45.4 in Sep. This is the monthly Conference Board survey.
India Reserve Bank meeting: Markets expect the repo and reverse repo rates to get raised by 25bp to 8.50% and 7.50%.

Wednesday 26th

Australia Q3 CPI: We expect 3.5%yoy, in line with consensus after 3.6% in Q2.

US Sep Durable goods orders: Consensus expects -0.8%mom after -0.1% in Aug.

EU Summit: According to EU Commission President Barroso, final decisions about the Euro-area debt crisis will be made at this summit.

Also Interesting: US new home sales.

Thursday 27th

US Q3 GDP: We expect 2.5%, in line with consensus after 1.3% in Q2.

RBNZ Meeting: Consensus expects no change from 2.50%.

Riksbank Meeting: Consensus expects no change from 2.00%.

BoJ Meeting: We expect no change from 0.10%, in line with consensus.

Regional German CPI data: Last month, these numbers were the first to indicate rising inflation pressures in the Eurozone core.

Also interesting: US jobless claims, Speech by Bundesbank Chef Weidmann, Turkey trade balance (Sep).

Friday 28th

Japanese Inflation and Industrial Production: consensus expects the data to paint a deflationary picture with faster-falling price indices and a notable drop in IP (-2.1% mom)

Italian Bond Auction: This could well be one of the first serious tests to see if the EU summit earlier in the week helped improve market confidence.

Russia Monetary Policy meeting: We and consensus expect unchanged rates at 3.75%.

US Sep Personal Income: Consensus expects 0.3%mom after -0.1% in Aug.

US UMich consumer sentiment: This is the final reading, which is expected to show only very marginal improvements compared to the preliminary reading.

Swiss KOF leading indicator: This is expected to drop notably to about 1.04 from 1.21, according to GS and consensus.

Also interesting: UK consumer confidence.