Economic Analysis

The most important data expected this week

United State

Building Permits (June) - Tuesday (2:30 pm)

US building permits, the proxy for future construction, fell 7% to an annual rate of 1.695 million in May 2022, the lowest level since September last year and well below expectations of 1.785 million. Permits fell for the second time after staying above 1.8 million in the past five months. Single-family permits fell 5.5% to 1.048 million, and unit permits for buildings of five or more units fell 10% to 0.592 million. Building permits fell in all four regions: the Northeast (-20.2%), West (-7.1%), Midwest (-7.6%) and South (-4.7%).

Existing Home Sales (June) - Wednesday (4:00 pm)

US existing home sales fell 3.4% to a seasonally adjusted annual rate of 5.41 million in May 2022, the lowest since June 2020 and broadly in line with estimates. Sales fell for the fourth consecutive month as rising mortgage rates and decades of high inflation eroded household incomes. Home inventory totaled 1,160,000 units, up 12.6% from April, and the median existing home price for all home types was $407,600, up 14.8% from May 2021. “Further sales declines are expected in the coming months due to challenges Housing affordability from a sharp rise in mortgage rates this year.”

United kingdom

Unemployment Change (June) - Tuesday (08:00 AM)

The UK unemployment rate rose to 3.8% in the three months to April 2022 from 3.7% in the three months to March and compared to expectations of 3.6%. It's the first increase in the unemployment rate since the last three months of 2020, with the number of people unemployed for up to six months rising the most since late 2020, but full-time employment is at an all-time high. The number of registered employees rose by 90,000 to 29.6 million in May, and vacancies in March to May 2022 rose to a new record of 1,300,000. However, the growth rate of job vacancies continued to slow.

CPI (MoM) (June) - Wednesday (08:00 AM)

UK annual inflation rose to 9.1% in May 2021 from 9% the previous month, the highest since 1982 and in line with market expectations. Acceleration of the cost of housing and utilities (19.4% vs. 19.2%); transport (13.8% vs. 13.5%); Food and non-alcoholic beverages (8.6% vs. 6.7%); furniture and household goods (10.5% vs. 10.3%); and alcoholic beverages and tobacco (5% vs. 4.4%). On the other hand, prices rose at a weaker pace for restaurants and hotels (7.6% vs 7.9%). recreation and culture (5% vs. 5.9%); health (1.8% vs 2.3%); and clothing and footwear (7% vs. 8.3%). Meanwhile, the inflation rate was constant in the education sector (at 4.5%); Communications (by 2.8%); and miscellaneous goods and services (2.9%). On a monthly basis, consumer prices rose 0.7%, above expectations of 0.6%, with major upward pressures coming from food and non-food prices.

Retail Sales (MoM) (June) - Friday (08:00 AM)

UK retail sales fell 0.5% monthly in May 2022, after a downwardly revised 0.4% increase in April and compared to market expectations for a 0.7% decrease. Sales in food stores decreased 1.6% due to the impact of higher food prices and cost of living. Meanwhile, sales of non-food stores were unchanged as the increase in clothing sales (2.2%) was offset by a decrease in household goods (-2.3%), such as furniture and department stores (-1.1%) while motor fuel sales increased (1.1%). ). Excluding fuel, retail sales fell 0.7%. Looking at the three months through May, retail sales are down 1.3%.

Euro-zone

CPI (MoM) (June) - Tuesday (11:00 AM)

Preliminary estimates showed that annual core inflation in the eurozone, which excludes prices for energy, food, alcohol and tobacco, fell to 3.7% in June 2022 from a record 3.8% in May. The numbers came in below market expectations of 3.9%.

ECB Rate Decision (July) - Thursday (02:15 PM)

Most European Central Bank policymakers favored a 25 basis point rate hike in July, but some officials preferred to keep the door open for a larger increase, according to the minutes of the European Central Bank's monetary policy meeting in June. However, they concluded that the 25 basis point increase was a proportionate first step and that opening the door for a larger increase in September would allow the central bank to benefit from updated forecasts and from monitoring the impact of the first rate hike on financial conditions over the summer. . The European Central Bank said during its June meeting that it will end net asset purchases under its implementation from July 1, 2022 and that it will raise the ECB's key interest rates by 25 basis points in July. During an emergency meeting a few days later, the central bank announced the preparation of a new anti-retail tool to help tighten widening spreads between countries such as Italy and Spain where bond yields have risen since the central bank took a more hawkish stance.

Australia

Monetary Policy Committee Meeting Minutes - Tuesday (03:30 AM)

The Reserve Bank of Australia raised its benchmark interest rate by 50 basis points to 1.35% during its July 2022 meeting. The move followed a June 50 basis point rise and a 25 basis point increase in May, raising the liquidity ratio to a level not seen since May 2019. The Board reiterated that massive monetary support is no longer required due to the strength of the economy and the current situation. Inflation pressures, adding that it was committed to tighten further with the volume and timing of incoming data. The central bank also saw that the labor market remained strong, with employment remaining at its lowest level in nearly 50 years, while a further decline in the unemployment rate is expected in the future. The Committee reiterated its commitment to do what is necessary to ensure that inflation returns to the target with attention to the global outlook still clouded by the war in Ukraine and its impact on energy and commodity prices. The Board of Directors raised the interest rate on exchange-settled balances by 50 basis points to 1.25%.

Canada

Core CPI (MoM) (June) - Wednesday (02:30 PM)

Canada's annual inflation accelerated to 7.7% in May 2022, the highest level since January 1983 and above market expectations of 7.4%. The main upward pressure came from transportation, food, and shelter as Western sanctions in response to Russian attacks on Ukraine continued to drive up energy and commodity prices. Transportation costs rose 14.6% (11.2% in April), supported by a 48% rise in gasoline prices (36.3% in April). Meanwhile, food price inflation remained unchanged at 8.8%, led by a 9.7% increase in grocery prices. Home prices also grew at the same pace of 7.4% as mortgages continued to rise. Excluding gasoline, the CPI rose to a new record high of 6.3%. On a monthly basis, consumer prices rose 1.4%, beating market estimates of a 1% increase, and up from 0.6% in April.

Turkey

Turkey - Overnight Borrowing Rate (July) - Thursday (01:00 PM)

Turkey's central bank left its one-week key repurchase rate steady at 14% as expected during its June 2022 meeting, saying that in the marked rise in energy-cost inflation caused by geopolitical developments, the temporary effects of pricing formations are far from economic fundamentals, no Strong negative supply shocks from increases in global energy, food, and agricultural prices continue to have an effect. Turkey's inflation rate rose to 73.5% in May, the highest level since 1998. The Board expects that the process of de-inflation will begin by re-establishing a global peace environment and eliminating the underlying effects of inflation, along with the steps taken and implemented with determination to promote sustainable price stability. and financial stability. The Board will continue to make its decisions in a transparent, predictable and data-oriented framework.