What to Expect This Week

This week, in the United States, we should see a fall in initial jobless claims after a surprising improvement in last week's nonfarm payrolls. Elsewhere, trade deficit should narrow slightly in November helped by a more competitive dollar exchange rate which is boosting exports and making imports less affordable. Also, November retail sales probably jumped on higher vehicle purchases.

In the Euro Area, we expect a third consecutive increase in industrial production due to a substantial recovery in manufacturing orders. In addition, it is likely that annual inflation will be confirmed at 0.3%. In Japan, the final Q3 GDP reading should be revised slightly lower. In the United Kingdom, the Bank of England will probably keep its monetary policy unchanged and leave the benchmark interest rate at 0.5%. In Canada, the Bank of Canada decision is unlikely to surprise as well since the bank already committed to hold the current policy rate until the end of Q2 2010. In Australia, after a cumulative 65K rise in payrolls during the past two months, we are looking for jobs to be flat, with a 0.1% rise in the unemployment rate to 5.9%. Also, consumer and business confidence should ease from high levels after the recent interest rate hikes. In New Zealand, we expect no change in interest rates, but the central bank should give more clues about an exit strategy for quantitative easing. Finally, in Switzerland, the Swiss National Bank will keep rates on hold and maintain unconventional measures to fight deflation risks.

Anna Fedec, contact@tradingeconomics.com
12/5/2009 1:49:23 PM