Economists and investors will scrutinise the latest purchasing managers' index (PMI) readings for 26 countries this week, including South Africa. On the whole, these forward-looking economic indicators are likely to point to a slowing global economy.
Three key central banks – the European Central Bank (ECB), Bank of England (BoE) and Reserve Bank of Australia – will also meet this week. In the wake of last week's rally-inducing European summit, markets will watch the ECB's announcements closely.
Here is your guide to the data releases, meetings and other economic events likely to generate headlines and move markets in the week ahead.
America's monthly jobs report – scheduled for release on Friday – will dominate the economic calendar in the world's largest economy this week. Markets expect a weak report.
Economists surveyed by Dow Jones forecast an increase of 100 000 non-farm jobs in June, better than the 69 000 gain reported in May but far below the 225 000 monthly average observed in the first quarter of 2012. The country's unemployment rate is expected to hold steady at 8.2%.
Another weak monthly employment report will add to a growing body of evidence that America's economic recovery is struggling to gain traction. It would also likely intensify calls for additional stimulus measures from the Federal Reserve, the nation's central bank.
Elsewhere on the docket, Monday will see the release of the Institute for Supply Management (ISM)'s manufacturing index. Economists surveyed by Dow Jones expect this factory purchasing managers' index (PMI) – a leading indicator of economic activity – to fall to 52 in June from 53.5 in May. Any reading above the 50 mark indicates expansion for the sector. The ISM's non-manufacturing PMI, due out on Thursday, is expected to decline from 53.7 to 53 over the same period.
In between, Tuesday will bring June's vehicle sales figures and May's factory orders data. Analysts surveyed by Bloomberg expect vehicle sales to remain largely unchanged, possibly rising from an annualised rate of 13.8-million units in May to 13.9-million units in June. Factory orders are seen rising 0.1% after falling 0.6% in April.
Finally, markets will get two additional snapshots of America's labour market on Thursday. ADP's employment report is expected to show that private payrolls rose by 115 000 last month, down from a 133 000 increase in May. Weekly initial jobless claims figures from the US labour department are expected remain largely unchanged.
Europe's week will kick off with a slew of PMI readings. These closely followed indicators are widely expected to make for grim reading, pointing to continuing contraction for the majority of Europe's manufacturing sector.
Eurozone figures will be released on Monday, as will individual gauges for 15 European countries, including Germany, France, the UK, Italy, Russia and Spain – the continent's largest economies. Separate indices covering the Russian, Irish, Swedish, Spanish, Italian, German and eurozone service sectors follow on Wednesday.
On Thursday, markets will turn their attention to policy meetings at the BoE and ECB. Analysts expect the BoE to expand the bank's asset purchasing programme by £50-billion, but to leave interest rates unchanged.
Economists expect the ECB to lower the eurozone's benchmark rate from 1% to 0.75%, a record low. Markets will also be watching to see if ECB President Mario Draghi announces a resumption of the bank's bond buying programme to assist Spain and Italy or extension of the bank's €2-trillion long-term refinancing operation (LTRO) to inject more liquidity into the continent's struggling banking system.
Also on Thursday, markets will be keeping a close eye on a Spanish bond auction of €2.5-billion in debt of various maturities. The auction is viewed by many as a key test of market reactions to an announcement by European leaders on Friday that they will free emergency funds to buy sovereign debt and allow direct recapitalisation of banks.
Germany and the Netherlands will also auction €4-billion in five-year notes this week and France will auction up to €8-billion in bonds on Thursday.
On Friday, Germany and Spain will release their latest industrial production statistics. Analysts expect to see further year on year declines in both sets of figures.
On Sunday, the China Federation of Logistics and Purchasing (CFLP) reported that China's official PMI slipped from a reading of 50.4 in May to 50.2 in June, indicating the slowest pace of expansion in seven months.
Last month's decline was led by a fall in the new orders sub-index, which dropped to a reading of 49.2, marking the second consecutive month in which the measure remained in contraction territory. In a statement accompanying the index's release, government economist Zhang Liqun said that a recovery in industrial production will "take time".
Earlier this morning, the privately administered HSBC China PMI – which surveys a sample of smaller-sized firms, on average, than the CFLP measure – showed a final reading of 48.2 for last month, down from 48.4 in May. Taken together, the two gauges are likely to fuel speculation that China's officials will soon announce additional stimulus measures to boost the country's flagging growth prospects.
Other national readings released this morning were equally disappointing. Vietnam's PMI sank to 46.6, an eight month low. Taiwan's index fell to 49.2, its first decline since January. And South Korea's measure fell to 49.4, its first negative reading in five months. The one regional bright spot was Indonesia's PMI, which rose from 48.1 to 50.2.
After Monday's data deluge, markets will turn their attention to the Reserve Bank of Australia's rates decision on Tuesday. Policymakers cut the bank's cash rate by 0.50% in May and 0.25% in June, but are expected to hold steady this week.
On Monday, Markit Economics will release Brazil's manufacturing PMI for June. Analysts at 4CAST expect the forward-looking measure of economic activity to fall further, to a reading of 49 from 49.3 in May.
If the forecast proves accurate, it would mark the third consecutive month of contraction for the country's manufacturing sector. Despite a weakened local currency, a series of stimulus measures and interest rate cuts, Brazil's manufacturing sector contracted in April and May.
Weak factory performance also contributed to Brazil's poor economic performance in the first quarter. During the first three months of 2012, the world's sixth largest economy – and continent's largest – grew by a mere 0.2% from the previous quarter.
More discouraging news is expected from trade figures scheduled for release later in the day. Markets expect exports to fall from $23.2-billion in May to $19.2-billion in June. Imports are predicted to fall from $20.3-billion to $18.8-billion over the same period, reducing the country's trade surplus from just under $3-billion to $350-million.
On Tuesday, investors will remain focused on Brazil as officials release May's industrial production figures. Markets expect output fell 0.2%, month on month, following a 0.2% decline and April and 0.5% contraction in March.
A series of data releases in South Africa – the continent's largest economy – and a central bank meeting in Kenya are the highlights of Africa's economic calendar this week.
In South Africa, the Bureau for Economic Research will release June's PMI and FNB will release its latest housing price index (HPI) on Monday. The National Association of Automobile Manufacturers in Southern Africa (Naamsa) will release vehicle sales data on Tuesday.
Last month's international reserves figures will follow from the reserve bank on Friday along with business confidence index (BCI) data from the South African Chamber of Commerce and Industry (Sacci) and housing price index readings from Absa.
Further north, investors will be watching to see if the central bank in Kenya – East Africa's largest economy – will begin loosening monetary policy this week. The bank's monetary policy committee (MPC) will announce its latest rates decision on Thursday.
The MPC boosted Kenya's benchmark lending rate to a record 18% in December in an attempt to curb high inflation – which peaked at 19.7% in November 2011 – and provide support to the country's weak currency. Inflation has since abated, falling from 12.2% in May to 10% in June, its lowest level since March 2011.
This easing of inflationary pressures has led some economists to believe that officials will begin lowering rates this week to aid the country's sluggish economy. Kenya's growth slowed to 3.5% in the first quarter of 2012, the slowest rate of first quarter growth since 2008.
Matt Quigley writes the weekly economic preview for the Mail & Guardian. His blog on the South African economy can be found at thoughtleader.co.za/mattquigley.