Global Economy Week Ahead: China Trade and Inflation, U.S. Productivity

By WSJ StaffFeaturesDow Jones Newswires

The week ahead features an influx of data from China, including foreign-exchange, inflation and trade numbers. In the U.S., the Labor Department will release second-quarter productivity figures and the July consumer-price index report.

MONDAY: China releases foreign-exchange reserves data on Monday, but given weakness in the U.S. dollar, along with Beijing's relentless scrutiny on capital flows, the world's largest foreign-exchange reserves are expected to show another modest gain of about $15 billion in July. In June, China's reserves rose for a fifth straight month, as the weaker U.S. dollar and Beijing's stringent controls over moving money offshore helped arrest outflows.

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TUESDAY: Renewed tension between Washington and Beijing on trade imbalances will keep China's trade data in focus. Economists expect the country's exports and imports grew 10.5% and 16.4%, respectively, in July from a year earlier, moderating slightly from June's growth, but still expanding at a strong pace. That would bring China's trade surplus to $46.40 billion in July, compared with June's $42.77 billion. China's trade data is closely watched as a barometer of strength in global trade though exports have become a less important factor in China's own growth in recent years.

WEDNESDAY: Economists expect both consumer and industrial price inflation in China to hold steady in July from June's level, when the readings grew 1.5% and 5.5%, respectively. Continued robustness in industrial inflation is good news to companies, as that can help them improve profits and repay their debts.

The U.S. Labor Department releases its preliminary second-quarter report on productivity. Some economists attribute the U.S. economy's slow wage growth to lackluster productivity gains in the aftermath of the recession. Economists surveyed by The Wall Street Journal expect productivity growth of 0.8% in the second quarter. U.S. worker productivity was flat in the first quarter, another sign of sluggishness during the expansion.

FRIDAY: The U.S. Labor Department releases the July consumer-price index, which was unchanged in June from the previous month. Recent softening of inflation has turned into a conundrum for the Federal Reserve, as the central bank weighs the timing of its next interest-rate increase. Economists will watch the report for any signs of firming price data. Economists surveyed by The Wall Street Journal forecast CPI gained 0.2% in July. On Aug. 1, the Commerce Department reported that the Fed's preferred measure of inflation, the price index for personal-consumption expenditures, was unchanged in June from the prior month, the second straight flat reading.

(END) Dow Jones Newswires

August 06, 2017 15:14 ET (19:14 GMT)