The dollar is weakening against the euro, Asian and European stocks indexes are facing selling pressure, and U.S. stock futures are set to open up in the red on Monday as investors prepare to absorb a wide range of economic reports this week in the United States and Asia for further clues about the health of the global economy.
The U.S. August jobs report on Friday will be closely watched since job growth is an important facet of the Federal Reserve’s monetary policy and it is also the last major economic data points that U.S. central bankers will weigh before deciding about raising interest rates at their next meeting in mid-September.
The forecast is for strong employment growth in August with 225,000 jobs expected, according to briefing.com.
Another employment report is released on Wednesday with private payroll processor ADP.
Briefing.com forecasts 220,000 private payroll jobs added in August.
On Tuesday a survey on Chinese factory and service sector activity will be released and the results should offer more insight about the strength of the Chinese economy.
Also on Tuesday in the United States, the ISM Index for August will be reported along with construction spending and auto/truck sales. U.S. factory orders will be reported on Wednesday.
During a speech on Saturday at a symposium in Jackson Hole, Wyoming, Fed Chair Stanley Fischer said the Fed will “most likely need to proceed cautiously in normalizing the stance of monetary policy.”
Fischer also suggested that a rate hike could be around the corner this year.
“With inflation low, we can probably remove accommodation at a gradual pace. Yet, because monetary policy influences real activity with a substantial lag, we should not wait until inflation is back to 2 percent to begin tightening” Fischer said.
U.S. Economic Calendar
Monday- Chicago PMI (august)
Tuesday- ISM index (august), Construction Spending (July), Auto/Truck Sales (august)
Wednesday- ADP employment change (August), Productivity, Unit Labor Costs, Factory Orders, Crude Inventories, Fed’s Beige Book
Thursday- Initial/Continuing Job Claims, Trade Balance (July), ISM Services (August), Natural Gas Inventories, Challenger Job Cuts
Friday- Non-farm payroll report (August)