The Week Ahead: Oct. 14-20, 2012

Chinese consumer and producer inflation data

Chinese inflation data will be closely watched by market observers as an indicator of China’s ability to continue stimulus and financial liberalization measures undertaken this year.

Parliamentary elections in Lithuania, Montenegro

Montenegro’s snap election is being held six months ahead of schedule, as politicians attempt to gain momentum in talks to join the European Union. Montenegro is second in line to join the EU after Croatia, which joins July 2013.

Russian election for regional governors and local officials

US September retail sales

Recall, consumption accounts for over two-thirds of the economy, so retail sales data are closely watched. However, as with most economic data, there’s a large degree of month-to-month variability and seasonality. Likewise, auto sales and retail sales in areas directly impacted by food and energy prices can have a substantial impact on the data.

Federal Reserve Empire state manufacturing survey

Independently, regional manufacturing surveys presage little about the overall US or global economies. Their results often tend to reflect short-term conditions driven by local industries rather than national trends.

US August business inventories

Second US presidential election debate in Hempstead, NY

Organized in a town-hall format, undecided citizens picked by the Gallup Organization will ask each candidate questions on foreign and domestic issues.

September US CPI, British CPI, PPI and EU HICP

Accommodative monetary policy around the world likely has many folks hyper-focused on inflation measures. But in Europe and the US so far, signs of inflation have yet to become problematic. And our view is they’re unlikely to become problematic in the near future as well.

September US Industrial Production

US Mortgage Bankers Association home purchase applications

EU Leaders Summit in Luxembourg

Expectations continue to be high Spain will request a formal bailout at some point during next week’s EU leaders’ meetings. However, since Spanish debt yields are currently manageable and programs are already underway for a bank recapitalization, our view is a bailout seems largely unnecessary at the moment.

Weekly US Jobless Claims

Philadelphia Fed Survey

Leading Economic Index

German PPI

US existing home sales