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The UK, US and the Eurozone in the week ahead

  • Chinese Retail Sales could show world’s second largest economy slowing
  • First UK employment data following closure of furlough scheme to be released
  • Eurozone employment slowdown could raise questions over ECB stance


Monday morning sees the publication of Chinese Retail Sales figures for October. These will be closely watched for any indication that the reported slowing of the nation’s economy is starting to impact consumer demand. High energy prices, government intervention and the resurgence of COVID-19 are all dragging now, with expectations being that the year-on-year figure will slip from the 4.4% posted in September down to something around 3.5%. Further declines towards the year end would certainly be cause for concern.


Tuesday morning sees the latest UK Unemployment data being published. The October claimant count is expected to decline by a further 30,000 – a number which will be very closely watched given the government furlough scheme came to an end in September. Average Earnings will also be under scrutiny, with the September figure set to show another modest decline from the 8.3% seen in August to just over 6%. That’s still well ahead of inflation but surprises on the downside to either of these figures could be seen and would have the potential to rattle confidence.

The preliminary Eurozone Employment change for Q3 will be issued Tuesday. Growing the jobs market has been seen by the ECB as a justification for tolerating high inflation, but with quarterly growth set to fall back from 0.7% to around 0.4%, the current stance taken by policymakers could be called into question. The risk here would seem to be that more stimulus is necessary, weighing on the Euro as a result.

US Retail Sales for October are also set to be published on Tuesday, with the annualised figure set to come in around 12%. That’s going to be down noticeably from the 13.9% posted a month ago, but should still be reflecting month-on-month growth. Given the widely reported supply chain issues, markets are unlikely to find any cause for concern here unless there’s a big shortfall.


The latest UK Inflation data for October will be out on Wednesday and given the Bank of England’s decision to hold fire on interest rate hikes at its recent policy meeting, it seems as if the upper estimates which have been offered here – as much as 4% – may prove too aggressive. Some uptick from the 3.1% posted in September seems inevitable, but relatively modest growth here could see the Pound cool and give UK equities cause for cheer, too.


GfK Consumer Confidence data for the UK will be released on Friday, offering a snapshot of sentiment for November. Having recorded a post-pandemic high of -7 in July, the number has been deteriorating since, but expectations are that October’s -17 could prove to be a turning point. There’s still no shortage of uncertainty in the market, but with COVID rates starting to fall again as booster vaccinations take effect, consumers may be looking at the run down to Christmas in a slightly more positive light.

Finally, UK Retail Sales for October will round off the week. After September’s surprise dip into negative territory, expectations are for a more upbeat assessment, although rising prices and the unknown extent of supply shortages could lead to a surprise in either direction here. This is a reading that still needs some time to settle as we emerge from the pandemic, so if there is an erroneous print here, it may be best not to read too much into it.

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This article does not constitute investment advice. Do your own research or consult a professional advisor.

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