The historic (finally we can retire this characteristic) and expected rate hike decision by the FOMC was finally made last week. The market’s reaction seemed a bit of an anticlimax, given the ample preparation the Fed made before raising rates. Now we can start focusing on the Fed’s rate hike pace and normalization process. This week will be a short one due to Christmas. There are still a few important reports, but for the most part the market will slowly wind down and digest the Fed’s rate hike. Some reports to consider this week include: U.S. GDP for Q3, EU consumer sentiment, GB current account, U.S. core durable goods, Canada GDP, BOJ’s minutes of policy meeting, Canada retail sales, U.S. core PCE, and U.S. new home sales. So let’s breakdown the main items for the week of December 21-25.
(All times GMT):
Monday, December 21st
15:00 – EU consumer Sentiment (final): Based on the latest report, the Euro Area consumer indicator rose by 1.6 to points -6 and is expected to remain unchanged this time;
Tuesday, December 22nd
09:30 – Great Britain Public Sector Net Borrowing: Based on the last update, public net borrowing dropped to a surplus of 7.5 billion pounds; this measures the gap between spending and income for public corporations, the central government and local governments; current expectations are for a shift to a higher surplus of 11.9 billion pounds;
13:30 – Third and Final Estimate of U.S GDP for 3Q 2015: This will be the last estimate of U.S’s third quarter 2015 real GDP growth. In the previous estimate for Q3 the GDP grew by 3.9% — marginally higher than expected. The current estimates are for the GDP growth rate to change course and fall back to 1.9%. A lower than expected growth rate could drag down the U.S. dollar, equities and commodities;
15:00 – U.S. Existing Home Sales: This report will pertain to the U.S. existing home sales for November 2015; in the October report, the number of homes sold fell to a seasonally adjusted annual rate of 5.36 million houses; the current expectations are for the annual rate to decline to 5.32 million houses;
Wednesday, December 23rd
09:30 – GB Current Account: According to the recent report, Great Brittan’s current account showed a lower deficit of 16.8 billion pounds. The current estimates are that the deficit will expand to 21.3 billion pounds;
13:30 – Canada Core Retail Sales: In the last report regarding October 2015, manufacturing sales declined by 0.5%;
13:30 – Canada’s GDP by Industry: This monthly report shows the developments in major industrial sectors for October 2015. In the previous update regarding September 2015, the real gross domestic product dropped by 0.5%;
13:30 – U.S Core Durable Goods: This will refer to November’s figures and will indicate the developments in U.S demand for commodities including oil and gas. As of October 2015, core durable goods rose by 0.5%, month over month; this time, however, core durable goods are expected to inch up by 0.1%;
13:30 – U.S. core PCE: The personal consumption expenditures index is an important indicator the FOMC follows to determine the progress in U.S. inflation. In the recent report, the core PCE (excluding food and energy) remained unchanged. The expectations are for the core PCE to edge up by 0.1%;
15:00 – U.S. New Home Sales: This report will refer to November; in the latest report (opens pdf), the sales of new homes increased to an annual rate of 495,000; current estimates are for a faster growth with an annual rate of 507,000;
15:00 – UoM Consumer Sentiment (revised): University of Michigan will release its revised consumer sentiment monthly report; this survey could provide information regarding the shifts in U.S consumers’ sentiment; according to the last report, the sentiment index rose to 91.3;
15:30 – U.S Crude Oil Stockpiles Weekly update: The EIA (Energy Information Administration) will release its weekly report on the U.S oil and petroleum stockpiles for the week ending on December 18th;
23:50 – BOJ’s policy meeting minutes: Bank of Japan will release the minutes of the last policy meeting. It may show what’s up ahead for the BOJ in terms of when and if its members plan to expand QE anytime soon;
Thursday, December 24th
13:30 – U.S. Jobless Claims Weekly Report: This weekly report will refer to the changes in the initial jobless claims for the week ending on December 18th; in the recent report, jobless claims declined to 271K; the expectations are for this number to remained nearly unchanged at 270K;
15:30 – EIA U.S. Natural Gas Storage: The EIA weekly report of the U.S. natural gas market will refer to the recent changes in natural gas production, storage, consumption and rates as of December 18th;
Friday, December 25th
Christmas Day
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