Spain holds regional elections, which could pave the way for an aid request in early November
Elections in Galicia and in the Basque country are seen as a referendum on Prime Minister Mariano Rajoy’s leadership. It’s widely believed Rajoy has postponed request aid from the ESM until these elections are over. However, as we’ve said before, since Spanish debt yields are currently manageable and programs are already underway for a bank recapitalization, our view is a bailout seems largely unnecessary at the moment.
September Mexican retail sales
Australian leading indicators index
US Presidential debate
The third and final US presidential debate focuses on foreign policy.
Eurozone consumer confidence
Confidence and other sentiment-based readings are backward-looking and presage little about the future direction of the economy or markets.
August Canadian retail sales
French business confidence
Richmond Fed September manufacturing index
Regional business and manufacturing surveys are often driven by short-term conditions in local industries rather than national (or global) trends. So these are worth watching, but with many grains of salt.
Australian Q3 CPI
German, French, EMU October flash PMI
Flash PMI results are preliminary, based on a limited set of data and subject to future revision. September’s report showed continued weakness in manufacturing and service, but some regions have shown surprising resilience while others have weakened. We expect that trend, on balance, to continue.
October German Ifo survey
This business sentiment index is closely watched as an appraisal of the current business expectations. However, as with consumer confidence and other such readings, they should be regarded with some cynicism.
US October flash PMI manufacturing index
September US new home sales and weekly mortgage bankers association purchase applications
On balance, housing data have shown considerable strength recently and new home sales have shown moderate improvements the last few months. However, it’s important to remember the economy has come this far without a robust housing recovery. From here, even minor housing improvements would be a nice tailwind—but not absolutely necessary. Another fact worth considering: Purchase application data only cover one week and can be volatile.
US FOMC announcement
Following the Fed’s announcement last month of QE3, continuing “Operation Twist” and maintaining an overwhelmingly accommodative policy stance for an extended period of time, we expect little new news from this month’s two-day meeting.
August Italian retail sales
Q3 UK and South Korean GDP
September US durable goods orders
US weekly jobless claims
Chicago Fed national activity index
The National Activity Index is unique in that it is one of the few regional Fed indexes that covers the entire country’s economy. However, it’s a composite of 85 other economic indicators released earlier in the month (many of which are backward-looking), so it likely presages little outside of what markets already know.
US pending home sales
Kansas City Fed manufacturing index
See Richmond Fed manufacturing index above (10/23).
US Q3 GDP
The advance release of Q3 GDP is subject to significant revision—often months and years after it is first released. That said, US GDP, while not gangbusters recently, continues to be driven by a still-strong private sector. Government spending, however, has detracted from headline growth in six of the last nine quarters. But shrinking government spending isn’t necessarily a long-term negative—it allows room for the private sector to allocate capital more efficiently.
US consumer sentiment
Early voting for the US presidential election begins in Florida, Maryland and the District of Columbia