July 29, 2024
United States:
Options Volatility Perks Up Before Earnings Wave, Rate Talks
Volatility is back — at least a little — heading into a week filled with central bank interest-rate decisions and quarterly earnings for some of the world’s biggest companies.
The drumbeat for a faster pace of US Federal Reserve rate cuts grew louder last week, with former New York Fed governor Bill Dudley calling for a reduction as soon as this week’s meeting or at least by September. Almost three-quarters of economists surveyed by Bloomberg News expect the Fed to signal plans to start rate cuts in September. The Bank of Japan may go in the other direction, with 90% of economists poll seeing the risk of a hike.
Europe:
ECB Rate Setters Want More Data Before Cutting — Plenty Will Come This Week
A barrage of euro-zone economic data this week will deliver crucial information for the European Central Bank as officials look for signals on whether to resume interest-rate cuts in September.
A report on Wednesday will probably show inflation at 2.5% for a second month, according to the median forecast of 36 economists in a Bloomberg survey. A Nowcast by Bloomberg Economics is more optimistic, showing a slowdown to 2.3%.
Asia:
Japan Expects to Hit Primary Balance Goal After Decade of Delay
Japan expects to hit its primary balance goal in the year starting April 2025, finally achieving the long-standing goal for fiscal health after more than a decade of delays.
The primary balance, which excludes net interest payments on public debt, is projected to be around ¥800 billion ($5.2 billion), or about 0.1% of gross domestic product in fiscal year 2025, according to the Cabinet Office’s mid-to-long-term outlook report Monday. This marks an improvement from the ¥1.1 trillion deficit, or -0.4% of GDP predicted in January, and would be the first surplus since the government set the target in 2002.
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