Week Ahead: unemployment, China in focus, central bank meetings

Unemployment rate

OCTOBER’s unemployment rate alongside the monthly retail sales are expected to be released by the Statistics Department this week.

Retail sales year-on-year (y-o-y) is expected to be at 9.5% while jobless rate at 4.2% by the end of this quarter, according to Trading Economics global macro models and analysts’ expectations.

Retail trade in Malaysia increased by 30% y-o-y in September, slowing from 34.5% in the preceding month.

Meanwhile, Bank Negara is expected to announce its international reserves as at Nov 30, on Wednesday.

China data

DATA due from China this week will include trade, inflation, producer price index (PPI) as well as Caixin PMI services for November.

According to a Bloomberg poll, the consumer price index (CPI) may decelerate to 1.6% y-o-y in November from 2.1% in October, while the PPI may contract by 1.4% y-o-y from minus 1.3% in October.

ING said export data for China and Taiwan should show a deeper yearly contraction, which reflects high inflation in the United States and Europe. As domestic and export demands have been weak, the PPI in China continues to shrink y-o-y, with the CPI stabilising just slightly above 2%, according to ING.

Central bank meetings

THE Reserve Bank of Australia (RBA) and Reserve Bank of India (RBI) will meet in their last monetary policy meeting of the year.

The RBA will go for another modest 25 basis points (bps) interest rate hike to 3.1%, its third in a row after a succession of half-point moves, according to all 30 economists polled by Reuters.

UOB Global Economics and Markets Research expects the RBA to announce another 25 bps hike, which will take the official cash rate to 3.1%. Thereafter, it looks for a hold.Australia is also expected to release its gross domestic product data for the third quarter.

ING thinks it will slow from the 0.9% quarter-on-quarter (q-o-q) growth rate shown in 2Q, but is likely to come in at around 0.7% q-o-q, which represents a decent rate of growth.

According to UOB, RBI will hike its policy repo rate further by 35 bps to 6.25% to rein in inflation while keeping a close watch on downside risks to growth.

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