Week Ahead – We Go Again

A busy end to a chaotic year

December may normally be associated with everything slowing down as we ease our way into the festive period but as with everything else in 2020, this is no normal December. Donald Trump is continuing to fight the election result and is going out swinging, Brexit talks are somehow still ongoing, the EU budget and rescue fund is at risk, the Fed and ECB may add to the enormous stimulus efforts of central banks this year and OPEC+ may have one final trick up its sleeve. A few more twists and turns to come, it seems.

Traders eye jobs report for signs of another Covid slowdown

Brexit going right to eleventh hour

PMIs to highlight ongoing China recovery


The upcoming week will provide crucial updates to both the labor market and manufacturing sector.  The coronavirus spread and growing restrictions being imposed across the country have yet to really impact manufacturing and hiring until possibly now. 

On Tuesday, the ISM manufacturing report is expected to show last month’s reading was the peak of the current recovery.  The highly watched index is expected to decline from October’s 59.3, which was the highest level since September 2018, to 57.8.  The fourth quarter slowdown is widely expected, but what might start becoming the consensus is for the first quarter to deliver an economic contraction. 

The last nonfarm payroll report of the year comes ahead of a live Fed meeting.  FOMC officials should be ready to act as softening jobs data could lead to permanent damage to the labor market.  The upcoming nonfarm payroll is expected to see 500,000 jobs created in November, but given the recent weakness investors might not be too surprised if we saw hardly any job gains. 

US Politics

The formation of the Biden’s cabinet has been clearly one that embraced diversity and experience with the Obama administration.  Wall Street has been positive to Biden’s picks for Secretary of State and Treasury Secretary.  Tony Blinken has experience under both the Clinton and Obama administrations and is viewed as someone who will be able re-engage US allies.  The selection of Janet Yellen as Treasury Secretary will raise expectations that the Fed and Treasury will be able to coordinate policy action early next year. 

The upcoming Georgia Senate races will start to draw attention, but it seems very unlikely Democrats will be able to pick up both seats.    


The battle continues between Hungary and Poland and the other 25 member states of the European Union over the “rule of law” clause tied to the 2021-27 budget, with the two countries vowing to stand side by side in its fight against Brussels. It’s difficult to see the way out of this, with both countries refusing to back down despite being massive financial beneficiaries as EU members. Two weeks to go until the EU summit and a deal looks unlikely, with other states insistent on the clause, which has been inserted to directly counter years of efforts in both countries to undermine it. 


Face to face talks will continue on Saturday as Michel Barnier returns to London after undergoing self-isolation. Progress has slowed during virtual talks and can hopefully gather some momentum once again, with there being barely any time left to reach a deal and get it ratified. We’re seeing more public rhetoric once again, but that’s perhaps to be expected as we get into the final points. With talks taking part every day, there is increased weekend risk, with the markets currently not factoring in the possibility of negotiations collapsing, leading to no deal.


Rishi Sunak presented the spending review this week, while the government also put in place new restrictions as the country comes out of lockdown next week. Although most people won’t really notice the difference, with almost the entire country in tiers two or three. Brexit is the big risk now for the UK, with Covid cases falling again, although Christmas will undoubtedly be problematic on that front.


The lira remains volatile but conditions are improving despite a small setback over the last week. The government and central bank have a small grace period now in which to prove to investors that there will be no going back to the kinds of policies that triggered the plunge in the currency to record lows earlier this month. 


Manufacturing and services PMIs headline the data releases from China next week as the country continues to perform solidly, despite countries around the world once again struggling to come to terms with another wave of Covid-19. 


The wine industry was the latest to fall victim to China’s assault on Australian imports, with duties of between 107.1% and 212.1% being imposed. Again, markets are showing little sign of being particularly concerned by the tariffs but that may change if China turns its attention to more core industries.

The RBA rate decision next week is the standout event although no change is expected.


Next week offers a selection of tier three data in Japan which should have little impact although the stock market is continuing to make solid gains as part of the vaccine rotation recovery move.

Economic Calendar

Sunday 29 November
Japan Industrial O/P Prelim MM SA Oct
Monday 30 November
China (Mainland) NBS Manufacturing PMI Nov 51.5
Turkey GDP Quarterly YY Q3 4.8%
Denmark GDP QQ Prelim Q3
Denmark GDP YY Prelim Q3
Denmark Unemployment Rate Oct
Switzerland KOF Indicator Nov 101.0
Switzerland Official Reserves Assets CHF Oct
Italy CPI (EU Norm) Prelim MM Nov
Italy CPI (EU Norm) Prelim YY Nov
Germany CPI Prelim YY Nov -0.2%
Germany HICP Prelim YY Nov -0.5%
Japan Jobs/Applicants Ratio Oct
Japan Unemployment Rate Oct
Tuesday 1 December
Japan Jibun Bank Mfg PMI Nov
Australia Building Approvals Oct -3.0%
Australia Current Account Balance SA Q3 7.1B
Australia Net Exports Contribution Q3 -1.7%
South Korea IHS Markit Mfg PMI Nov
Indonesia IHS Markit PMI Nov
China (Mainland) Caixin Mfg PMI Final Nov 53.5
Australia RBA Cash Rate Dec 0.10%
Russia Markit Mfg PMI Nov
United Kingdom Nationwide house price mm Nov 0.4%
United Kingdom Nationwide house price yy Nov 5.6%
Turkey Manufacturing PMI Nov
Italy Markit/IHS Mfg PMI Nov 52.0
France Markit Mfg PMI Nov
Germany Markit/BME Mfg PMI Nov
Germany Unemployment Chg SA Nov
Germany Unemployment Rate SA Nov
Germany Unemployment Chg SA Nov
Germany Unemployment Rate SA Nov
Italy GDP Final QQ Q3 16.1%
Italy GDP Final YY Q3
Turkey ITO Istanbul Retail Prices Nov
Euro Zone Markit Mfg Final PMI Nov 53.6
United Kingdom Markit/CIPS Mfg PMI Final Nov 55.2
Euro Zone HICP Flash YY Nov -0.2%
Euro Zone HICP-X F&E Flash YY Nov
India IHS Markit Mfg PMI Nov 57.3
New Zealand Milk Auctions 3 Nov, w/e
Canada GDP QQ Annualized Q3
Canada GDP MM Sep
Canada Markit Mfg PMI SA Nov
United States Markit Mfg PMI Final Nov
United States ISM Manufacturing PMI Nov 57.5
Mexico Markit Mfg PMI Nov
Indonesia Inflation YY Nov 1.53%
Wednesday 2 December
Australia Real GDP QQ SA Q3 2.5%
Australia Real GDP YY SA Q3 -4.5%
Euro Zone Unemployment Rate Oct 8.4%
Thursday 3 December
Japan Services PMI Nov
Australia Trade Balance G&S (A$) Oct 5,800M
China (Mainland) Caixin Services PMI Nov
India IHS Markit Svcs PMI Nov 55.5
Russia Markit Services PMI Nov
United Kingdom Reserve Assets Total Nov
Turkey CPI MM Nov
South Africa Std Bank Whole Econ PMI Nov
France Markit Serv PMI Nov
France Markit Comp PMI Nov
Germany Markit Services PMI Nov 46.2
Germany Markit Comp Final PMI Nov
Euro Zone Markit Serv Final PMI Nov 41.3
Euro Zone Markit Comp Final PMI Nov 45.1
United States Initial Jobless Clm 28 Nov, w/e 770k
United States Markit Comp Final PMI Nov
United States Markit Svcs PMI Final Nov
United States ISM N-Mfg PMI Nov 56.0
Friday 4 December
Australia Retail Sales MM Oct 1.6%
India Cash Reserve Ratio 4 Dec 3.00%
India Repo Rate 4 Dec 4.00%
India Reverse Repo Rate 4 Dec 3.35%
Germany Industrial Orders MM Oct 1.4%
United States Non-Farm Payrolls Nov 500k
United States Unemployment Rate Nov 6.7%
United States Average Earnings YY Nov 4.3%
United States International Trade $ Oct -64.7B
Canada Employment Change Nov
Canada Unemployment Rate Nov
Canada Trade Balance C$ Oct
United States Factory Orders MM Oct 0.9%
Russia CPI MM Nov
Russia CPI YY Nov

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam