Week Ahead Economic Preview: Week of 5 August 2019

• Global services PMI for July, including IHS Markit and ISM US surveys
• UK GDP, German industrial updates
• Japan GDP, China inflation and trade
• Special reports on European growth forecasts and global manufacturing

With central bankers around the world focusing on the extent to which global economic conditions might necessitate further stimulus, services PMIs will provide an important steer at the start of the third quarter.

While the global factory downturn hit the fiercest since 2012 in July, according to PMI numbers, a key question for policymaking is whether services growth will have helped support economies, as had been seen in June. The overall pace of global economic growth remained stuck at a three-year low in June, adding to policymakers' worries.

The Fed responded to the deteriorating economic environment with the first cut to US interest rates for a decade in July, and forthcoming services PMI and ISM data could provide useful steers as to whether weak US growth will have persisted into the third quarter, provoking further cuts later in the year.

No change in policy was meanwhile seen at the Bank of England in July, but any signs of a possible UK recession could add to rate cut calls and put further downward pressure on sterling. Official GDP data look likely to show stagnation at best in the second quarter. Services PMI data for July will meanwhile provide an important steer on third quarter UK GDP.

In the eurozone, final services PMI data are updated alongside key industrial production and trade data for Germany. Germany lies at the heart of the region's recent slowdown and has drawn particular attention at the ECB as it prepares for more stimulus.

While the Bank of England and ECB have recently revised down their outlooks for growth, our first special report looks at how consensus forecasts for Europe still look overly optimistic.

In Asia, central bank meetings in Australia, New Zealand, India, Thailand and the Philippines will be watched for more stimulus, while Japan's GDP update will be of particular interest as the country gears up for a sales tax hike. China and Taiwan inflation and trade data will also be scrutinised alongside services PMIs for the region's largest economies.

Download the report for the full content which includes:

Global overview

Key diary events

US week ahead

Europe week ahead

Asia Pacific week ahead

Special Reports

Europe: European growth expectations remain too optimistic

Global: Worldwide manufacturing downturn deepens at start of third quarter

Contact us

European and US PMI commentary: Chris Williamson

Europe commentary: Ken Wattret

APAC commentary: Rajiv Biswas or 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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This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.