Week Ahead: Labour Market Data and Key Economic Releases
The upcoming trading week will be heavily focused on US labour market developments. In addition to the closely watched Nonfarm Payrolls (NFP) report, attention will be on the ISM indices for manufacturing and services. Other notable releases include Canadian labour market data, Eurozone flash CPI, UK retail sales, and Australian GDP.
Monday will be quieter due to the US Labour Day holiday, though Asia delivers key PMI figures, including China’s Caixin manufacturing index. On Tuesday, the spotlight shifts to Eurozone inflation data and the US ISM Manufacturing PMI. Wednesday brings the ADP employment report, final service-sector PMIs, and US durable goods orders. On Thursday, the ISM Services PMI is due, before Friday delivers the most important data of the week: the US NFP report, Canadian jobs, UK retail sales, and Eurozone GDP.
The ISM Manufacturing PMI will be compared with the latest S&P Global data, which recently surged to a 39-month high, signalling a strong rebound in industrial activity. Rising new orders and job growth underline healthy demand, although higher costs and geopolitical uncertainties remain key risks.
The ISM Services PMI showed a slight cooling but still points to solid expansion. Sales growth and higher prices highlight persistent inflationary pressures, yet resilient demand and stronger exports continue to support the sector.
The main focus is Friday’s US jobs report (NFP). Consensus expects around 75,000 new jobs in August, following 73,000 in July, while the unemployment rate is forecast to tick higher to 4.3%. Average hourly earnings are seen rising by 0.3% MoM. These figures carry significant implications for Federal Reserve policy. Following Jerome Powell’s Jackson Hole comments, markets now price in an 85% chance of a 25bps rate cut in September, with a second move expected by year-end.
Overall, the week could prove decisive for market sentiment. Labour market signals, together with ISM data, will set the tone for trading and determine whether expectations for Fed easing are further cemented or reassessed.