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Global Week Ahead: U.S., Japan and Brazil Policy Meetings

29 Jul 2018 5:00 pm
By WSJ Staff 

In the week ahead, central banks including the U.S. Federal Reserve, Bank of Japan and Brazil's central bank will hold policy meetings. On the data front, the eurozone will see second-quarter gross-domestic product figures, while the U.S. will receive figures on personal income and jobs.

TUESDAY: The Bank of Japan concludes its regular policy meeting. Policy-board members may consider ways of giving more flexibility to the BOJ's policy of fixing the yield on the 10-year government bond at zero. After nearly two years of stasis, market watchers are watching whether the BOJ backs away from its monetary-easing policy.

The eurozone economy slowed at the start of 2018, and gross domestic product figures for the second quarter aren't expected to record a rebound. At around 1.6%, growth is expected to be well below the 4.1% recorded by the U.S. during the three months through June, ending a period in which the two or growing at similar speeds.

The U.S. Federal Reserve begins a two-day policy meeting in Washington. The Fed is widely expected to leave its benchmark rate unchanged at its policy meeting and then increase it in September by a quarter-percentage-point to a range between 2% and 2.25%. Central bank officials have raised rates twice this year, and penciled in two further increases this year and three in 2019.

The U.S. Commerce Department releases the June report on personal income and spending. In May, personal-consumption expenditures increased a seasonally adjusted 0.2% from the prior month, while personal income rose 0.4% in May. Economists will also parse the report for signs of continued strengthening in inflation. May's data shows the price index for personal-consumption expenditures, the Federal Reserve's preferred inflation measure, was up 2.3% from a year earlier, exceeding the central bank's 2% target. Economists surveyed by The Wall Street Journal expect personal income rose 0.3% in June, while consumer spending was up 0.4%.

WEDNESDAY: Brazil's central bank is widely expected to keep rates steady at a historic low of 6.5% on Wednesday. Currency-market volatility and domestic political turmoil raised speculation that a rate increase was coming, but those fears abated recently as inflation remained within target. The bank also will release June's budget data on Monday.

FRIDAY: The U.S. Labor Department releases the July jobs report. In June, the economy added 213,000 jobs, while hundreds of thousands of Americans started looking for jobs, helping push the unemployment rate up to 4.0%. Economists will watch to see whether average monthly job gains this year continue to outpace the last two years. Economists surveyed by The Wall Street Journal forecast employers added 188,000 to nonfarm payrolls in July, while the unemployment rate ticked down to 3.9%.

(END) Dow Jones Newswires

July 29, 2018 13:00 ET (17:00 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.
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