February Outlook: Australia Edition

After a volatile start to the year, Australia’s financial markets will look to the economic data for guidance during the month of February. Below is a look at the major market-moving events on the Australian calendar over the next 29 days.

February 2: Building Permits (December), Trade Balance (December)

The Australian Bureau of Statistics will release a pair of closely-watched economic indicators on February 2. Building permits, a bellwether of future construction plans, will be released alongside official trade data. Australia is considered an export-oriented economy, making trade figures particularly important for investors. In addition to the official trade balance, government economists will also release individual data on imports and exports.

February 6: Melbourne Institute TD Securities Inflation (January), Retail Sales (December), AiG Performance of Construction Index (January)

The first Monday of February will see a deluge of economic data. It all begins with the Melbourne Institute’s monthly barometer of consumer inflation. Australian consumer prices rose 1.8% year-over-year in December, according to Melbourne Institute data. Since official CPI figures are released quarterly, investors rely on the TD Securities report for an accurate snapshot of monthly inflation trends.

Separately, the Australian Bureau of Statistics will report on December retail sales, a gauge of consumer spending in the economy. Receipts at retail stores rose just 0.2% in November.

Finally, the Australian Industry Group (AiG) will release its monthly gauge of construction activity. Australia’s construction sector contracted in December, and will look to bounce back at the start of 2017.

February 7: RBA Rate Decision

On February 7, the Reserve Bank of Australia (RBA) will meet to discuss monetary policy and set the interest rate. Since cutting interest rates to all-time lows last August, the Reserve Bank has remained largely on the sidelines. Central bank officials are unlikely to adjust monetary policy in February.

February 9: HIA New Home Sales (January)

Housing is an important segment of the Australian economy. On February 9, the Housing Industry Association (HIA) will release data on January new home sales, which will be used to gauge the strength of the domestic real estate sector. New home sales rose 6.1% in December, HIA data showed.

February 10: Home Loans and Investment Lending for Homes (December), RBA Monetary Policy Statement

Investors tracking Australia’s housing sector will be paying close attention to government data on home loans and investment lending for homes on February 10. Separately, the RBA will release its Monetary Policy Statement, which provides an overview of economic and financial conditions inside the country.

February 13: Westpac Consumer Confidence (February)

The Westpac consumer confidence index is used by financial market participants to gauge consumers’ willingness to spend money. The monthly release reinforces expectations concerning consumer behavior in the economy.

February 16: Melbourne Institute Consumer Inflation Expectations (February), Employment Change (January)

On February 16, a pair of high-profile economic reports will make their way through the financial markets, beginning with the Melbourne Institute’s monthly gauge of consumer inflation expectations in the next 12 months.

The Australian Bureau of Statistics will then release its monthly employment report for January. Australia’s labour market has improved in recent months, with employers adding full-time workers at a faster rate. A total of 13,500 jobs were added in December, government data showed last month.

Australia’s official employment report also includes key data on unemployment and the participation rate, giving investors a holistic view of the labour market.

February 21: RBA Meeting Minutes

The rationale behind the Reserve Bank of Australia’s February 7 policy decision will be released two weeks later by way of meeting minutes. The official transcript may provide important clues about future changes to monetary policy.

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