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Weekly Market Outlook: Eurozone Inflation & US GDP

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The week ahead is quiet and short for the US markets. Thanksgiving on November 28th will see a slowdown in trading volumes as traders head into a long weekend.

Among other high ticket items this week, Canada will be releasing its monthly GDP figures on Friday. Monthly GDP is forecast to rise by 0.2% for September.

Germany’s IFO business climate data and expectations are starting the week off, which could see a market reaction.

Here’s a brief look at the key economic events coming up for the week ahead.

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Fed Speech & Revised GDP Figures

The slow patch of economic data continues this week with a mix of high and low impact news releases for the United States. Among the line-up of events includes Fed Chair Powell’s speech and the revised GDP numbers.

US Q3 GDP to Hold Steady

The third and final estimates on the GDP number for the three months ending September 2019 are due this week on Wednesday.

The US economy is forecast to rise at 1.9%, marking an unchanged print from the previous estimates. This will confirm a below 2% growth rate in the US economy.

Besides the GDP data, other revisions include the quarter PCE report. The core personal consumption expenditure is set to rise higher from 1.5% to 2.3%, according to economists. Meanwhile, the GDP price index is also set to rise to 2.4% from 1.6% previously.

Durable goods orders are also due on the same day. US durable goods are set to fall for another month. Estimates show a 0.8% decline following a 1.2% decline earlier in September.

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Powell Speech Unlikely to do Much for the Markets

Fed Chairman Jerome Powell will be speaking this week. The speech entitled Building on the gains from the long expansion will see some references to the economy.

So far, Fed officials are mum on US monetary policy after confirming that rates will be cut further. Investors remain tuned into Fed speeches for further direction on monetary policy.

Eurozone Inflation & French Data

A quiet week from the eurozone will focus on the preliminary inflation data from both the eurozone and France. Estimates show a modest increase in consumer prices. However, inflation is still far off from the ECB’s target rate.

Producer price index data alongside consumer sentiment reports for the eurozone will give us insights into the price pressures and sentiment in the region.

Eurozone Inflation to Slightly Rise in November

The preliminary inflation report for November will be coming out this Friday.

According to median estimates, consumer prices will rise slightly to 1.2% on the year in November. This marks a slight increase from the 1.1% increase registered in October.

But, investor focus will be on core inflation. Core inflation, which excludes volatile food and energy prices, fell to 0.7% on the year in October. For November, estimates point to a slight increase to 0.9% on the year.

Although the core inflation rate remains below 1%, forecasts point to a modest increase from the year before.

French GDP to Remain Steady at 0.3%

For the remainder of the week, data will also cover the regional reports. It’s a somewhat busy week for France as inflation and GDP reports are due.

The final GDP revision for France is likely to show that GDP is steady at 0.3%. This will mark an unchanged print from the previous estimates.

With the German economy slowing, focus has shifted to the French economy which is doing the heavy lifting in the eurozone. Besides the GDP numbers, the preliminary inflation data for France is also due.

Economists forecast that headline inflation in France will rise 1.1% on the year, following a 0.9% increase previously.

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