What to Expect This Week

This week, in the United States, highly anticipated labor data will provide more evidence the Obama administration stimulus plan is not being translated into more jobs. Indeed, unemployment rate is expected to have risen to 10% in October and nonfarm payrolls drop by nearly 200K.

Elsewhere, the Federal Reserve will hold its monthly meeting but we don’t expect any changes on its monetary policy. In the Euro Area, the European Central Bank is likely to do the same and leave interest rates unchanged. However, unlike the Federal Reserve, the Governing Council of the ECB should give some hints about timing and implementation of an exit strategy for quantitative easing. Still in Euro Area, business sentiment, as measured by the Purchase Manufacturing Index (PMI) should record an upward revision from its flash estimate. In the United Kingdom, the Bank of England may extend its quantitative easing program by £25bn over the next three months as third quarter GDP growth came negative. Moreover, we are looking for a rebound in industrial production for September and improvement in Manufacturing and Services PMI’s for October. In Australia, the RBA is set to raise the cash rate by another 25bp. Finally, in Canada and in New Zealand, the unemployment rate is likely to climb further.

Anna Fedec, contact@tradingeconomics.com
10/31/2009 4:42:46 PM