US Federal Reserve governor Michelle Bowman believes that inflation will decline further. And if the economic data continues to show that inflation is moving sustainably towards the Fed’s 2% goal, then Bowman said that it will be appropriate to gradually lower interest rates.
But she also stressed that patience is required. We will find out what the other Fed members think when the minutes of the latest rate-setting committee are released.
Inflation in India will be on view when it reports its latest consumer prices index on Monday. It is forecast that the annual consumer inflation rate could moderate from 5.9% to 3.9%.
China is expected to say that the price of new homes has continued to fall in July. If the forecast of a 5.0% decline is correct, then it would be the 13th straight month of decrease. Staying in China, retail sales for July are expected to show a slight year-on-year growth of 3%.
On the results front
A couple of US consumer heavyweights, namely Home Depot (NYSE: HD) and Walmart (NYSE: WMT) could provide some colour to the buying behaviour of American households. In May the big box retailer reported a fall in both first-quarter earnings and revenue. Worryingly, Home Depot also said that same-store sales fell, which could be a reflection of inflation-weary consumers.
Unlike Home Depot, cash-strapped households could be a boon for Walmart. In May, it said that it has benefitted from the widening gap between the price of cooking at home and buying food at fast-food chains.
Hon Hai Technology (NYSE: HNHPF), which is also known as Foxconn, is the world’s largest electronics maker. The company, which is a supplier of Apple products, said in May that first-quarter profit was boosted by strong demand for AI servers. It also said that it expects second-quarter revenue to grow significantly.
A bunch of Asian-based E-trailers are penciled in for results. They include Sea Ltd (NYSE: SE), Tencent Holdings (NYSE: TCEHY), Alibaba Group (NYSE: BABA) and JD.com (NYSE: JD). In May, Sea Limited, which owns the online shopping channel Shopee, reported a first-quarter loss of US$23 million. But it said that it had a clear roadmap for profitable growth.
Meanwhile, Tencent, Alibaba and JD.com could provide some important insights into China’s economy. China’s slowing economy could have an impact on these companies’ advertising and fintech operations.
Staying with China matters, Yanlord Land Group (SGX ) said in February that 2023 was exceptionally unusual. It added that China’s economic recovery remains a challenge and that China’s real-estate credit crisis that began in 2021 has persisted throughout the year.
Other companies wire results include Haw Par (SGX: H02), Wilmar International (SGX: F34), Olam Group (SGX: VC2), and StarHub (SGX: CC3).
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Disclosure: Haw Par is a component of DKIP.
