The most important information of the day has been released. The observation of macroeconomic indicators is not optimistic.
The rates rose again
Today at 6:30 CET, the RBA announced decision on interest rates. As forecasted, there was a rate hike, this time by 50 bp and reached 2.35%. Speaking of Australia, we were awaiting RBA decision this week, which I have commented in my Sunday’s article.
Construction industry in UK
Today at 10:30 CET the Great Britain will release the results on the level of the activity level of purchasing managers in the construction industry. The results from the beginning of the year indicated that he was very active in this area. In January, the index was 56.3, and for the next two months it remained at 59.1. From April, the results received a downward trend of the indicator. The result for April has already dropped significantly and reached the level of 58.2. In the following three months, the indicator was at the level of 56.4, 52.6 and 48.9, respectively. Following the latest data, the result for the month of August is expected to be at 48.0. This would mean a significant shrinkage of the industry.
General economic condition
At 16 CET the US publishes the results of the general economic condition index for the non-manufacturing sector. Following the latest results, the index is expected to drop again to 55.1. From March to June, the indicator slowly decreased from 58.3 to the level. 55.3 In July, it rose slightly to 56.7. Such an increase could have been a shortcut of the peak of the summer season, therefore the forecast result in August is lower than in July.
The NMI is a composite index based on the diffusion indexes for four of the indicators with equal weights: Business Activity (seasonally adjusted), New Orders (seasonally adjusted), Employment (seasonally adjusted) and Supplier Deliveries.
The Non-Manufacturing ISM Report on Business is based on data compiled from monthly replies to questions asked of more than 370 purchasing and supply executives in over 62 different industries representing nine divisions from the Standard Industrial Classification (SIC) categories. Membership of the Business Survey Committee is diversified by SIC category and is based on each industry contribution to Gross Domestic Product (GDP).
Private services sector
At 15:45 CET Markit Economics will published The Service PMI release. The activity of the private services sector has been on a downward trend since April. The first result below 50 was achieved in July (47.3), the next result below is expected in the month of August (44.3). This means that the geopolitical situation had a significant impact on the private services sector, weakening it significantly.
The data are based on surveys of over 400 executives in private sector service companies. The surveys cover transport and communication, financial intermediaries, business and personal services, computing & IT, hotels and restaurants.
At 15:45 CET the United States will also publish the U.S. results. S&P Global Composite Purchasing Managers Index (PMI). Since April, like most indicators, the index has been in a downward trend. The earnings forecast for August also follows the trend and is expected to decline to 45.0.
Next important information form Australia
Australia also releases its Q2 Gross Domestic Product at the end of the day. Australia expects that the decisions taken earlier had a positive impact on the final result and GDP will reach the level of 1.0%. In the previous quarter, the index was at the level of 0.8%.
There will also be speeche today:
- German Bundesbank Executive Board Member Mauderer will be speaking at 12:30 CET.