Week Ahead Economic Preview: Week of 17 August 2020

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• Flash PMI surveys for August for the US, Eurozone, UK, Japan and Australia
• FOMC and RBA meeting minutes
• US jobless claims and home sales
• Indonesia and Philippines monetary policy
• Thailand GDP updates

With a resurgence of the coronavirus in parts of the world, and associated lockdowns re-imposed, flash August PMI updates for major economies in the coming week will be under the spotlight as analysts seek fresh insights into the prospect of further economic recovery.

The worldwide PMI surveys indicated a strengthening of global economic growth during July, but the upturn remained subdued by containment measures. This has sent a warning signal that global growth could slow again after the initial rebound, particularly when recent weeks have seen some restrictions re-introduced. An additional concern is that worldwide, jobs continued to be shed, despite widespread government policy support. This has the potential to dampen consumption and frustrate the recovery in the months ahead.

In the US, focus will turn to the flash PMI survey data to assess the pace of the recovery midway through the third quarter, with eyes particularly on the PMI's gauge for employment. The release of FOMC minutes will be closely assessed for clues regarding any future policy movements, while other US data will include jobless claims, home sales and regional manufacturing surveys. Markets will also look out for any progress in the fiscal plan negotiations.

In Asia Pacific, flash PMI data for Japan and Australia will be eyed, with the latter drawing particular scrutiny to gauge the economic impact of new COVID-19 restrictions imposed in Victoria amid a sharp rise in infections. Monetary policy decisions will come from Indonesia and the Philippines while the RBA meeting minutes will be closely monitored for policymakers' latest assessment of the economic outlook. GDP numbers in Thailand are expected to make grim reading, reflecting the trend seen across many Asian economies where data has already been released.

In Europe, the flash PMI surveys for the UK, Eurozone, Germany and France are supplemented by other key releases, including retail sales, inflation and household finance figures in the UK, as well as sentiment surveys in the Eurozone.

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PMI commentary: Chris Williamson

Europe commentary: Ken Wattret

APAC commentary: Rajiv Biswas and Bernard Aw

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Purchasing Managers' Index™ (PMI™) data are compiled by IHS Markit for more than 40 economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies, and are available only via subscription. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment and inventories. The PMI data are used by financial and corporate professionals to better understand where economies and markets are headed, and to uncover opportunities.

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