Global Economy Week Ahead: U.S. and U.K. GDP; Policy Decision From the ECB
October 22 2017 - 2:29PM
Dow Jones News
By WSJ Staff
In the week ahead, we will see early readings on third-quarter
gross domestic product in the U.S. and the U.K., as well as
monetary policy decisions from the eurozone and Brazilian central
banks.
WEDNESDAY: Brazil's central bank is expected to bring its
benchmark Selic rate to 7.5% on Wednesday, down from 8.25%. A sharp
drop in inflation over the past year is fueling the monetary
easing, with the Selic rate expected to break the historic low of
7.25% later this year. Lower borrowing costs, in turn, are feeding
a wobbling economic recovery after two years of output
contraction.
Amid market speculation that the Bank of England is getting
close to raising interest rates for the first time in a decade,
investors will pay close attention to preliminary U.K. economic
growth figures for the third quarter. Analysts polled by The Wall
Street Journal predict gross domestic product continued to expand
at the 0.3% quarterly rate seen in the April-June period. The
largely domestic-driven economy has slowed this year as consumers,
squeezed by accelerating inflation, pared back spending.
THURSDAY: The European Central Bank is expected to announce the
fate of its giant bond-buying program, known as quantitative
easing. With the eurozone economy picking up speed, policy makers
are expected to scale down the landmark stimulus program. But they
are also likely to extend it deep into 2018, in an effort to
bolster still-weak inflation. One key issue for investors is
whether the ECB will announce a concrete end date, which would
affect when interest rates might start to rise.
FRIDAY: The U.S. Commerce Department releases its advance
estimate of third-quarter gross domestic product. U.S. economic
output grew at a 3.1% annual rate in the second quarter, slightly
stronger than previously thought and marking the best growth in two
years. Friday's figure will likely be affected by hurricanes Harvey
and Irma in categories ranging from construction to consumer
spending. Economists surveyed by The Wall Street Journal forecast
GDP rose at a 2.7% seasonally adjusted annual rate in the third
quarter.
The University of Michigan releases its final figure for U.S.
consumer sentiment in October. The University of Michigan said
earlier this month its preliminary reading was 101.1 in October, up
from 95.1 in September. Consumer sentiment soared following the
election of President Donald Trump and has remained high this year
in light of a strong labor market and soaring stock prices.
Economists surveyed by The Wall Street Journal expect a final
October consumer sentiment reading of 100.9.
(END) Dow Jones Newswires
October 22, 2017 15:14 ET (19:14 GMT)
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