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Strength is this week's theme, at least for the most part. Lower rates and Washington's borrow and spend policy appear to be giving the US labor market a sizeable push going into year end. Growth in the global economy in general also appears to be improving, or at least no longer deteriorating. This lift is expressed in the week's central bank decisions where, despite some expectations for further stimulus, policy makers proved content, as perhaps those at the US Federal Reserve will also be in the coming week, to sit back and wait for prior cuts to do their work.
 Contrary to expectations for a 25 basis point rate cut, the Reserve Bank of India left its benchmark repurchase rate unchanged at a nine-year low of 5.15 percent. This followed a cumulative cut of 135 basis points at the five previous meetings. Since the RBI's last policy meeting in October, incoming data have generally been weak. GDP growth slowed for the fifth consecutive quarter from an annual 5.0 percent in the June quarter to a six-year low of 4.5 percent in the September quarter. And though headline inflation has risen sharply the last two months to 4.62 percent in October and above the mid-point of the RBI's 4 percent target, food prices have been driving the increase with underlying price pressures actually moderating. Despite weak activity, officials believe this year's aggressive easing is likely to have a big positive impact on the economy. They also noted that the upcoming government budget will provide more clarity on what fiscal support the economy will receive. Based on these factors, officials concluded that it was appropriate to "pause" policy easing "at this juncture" while still recognizing that there is "space" for further rate cuts in the future.
 First November and now December, the Reserve Bank of Australia left its policy rate unchanged at 0.75 percent, in line with the consensus forecast. This followed cuts of 25 basis point rates at the RBA's meetings in May, June, and October. December's statement said the outlook for the global economy remains "reasonable" and that some of the downside risks have recently "lessened". Officials retained their view that the domestic economy appears to have reached "a gentle turning point" and they forecast economic growth to pick up to around 3.0 percent in 2020, with activity supported by low interest rates, recent tax cuts, and higher infrastructure spending. Yet prospects for household consumption were again cited as the main domestic uncertainty. The assessment of the jobs market played a major role in the RBA's prior rate cuts, and officials noted at this month's meeting that the unemployment rate has remained steady around 5.25 percent, a high enough level to indicate that spare capacity remains in the jobs market and that the economy can sustain lower rates of unemployment without triggering an unwelcome increase in inflation. Officials continued to expect inflation to "increase gradually" from 1.7 percent in the third quarter toward their 2.0 percent target. Despite leaving rates on hold, officials repeated their assurance that they are prepared to ease policy further if required.
 Like the RBI and the RBA, the Bank of Canada also left rates unchanged at their December meeting. In line with expectations, the target for the benchmark overnight rate stayed at 1.75 percent. The BoC upgraded the evaluation of the global economy, noting that there is "nascent evidence" that it is stabilizing, with growth expected to edge higher over the next couple of years. Recession concerns are seen as waning, with central banks supporting financial markets that, however, are still being buffeted by trade conflicts. On the domestic front, the bank noted that consumer spending, supported by wage growth, is on the rise with housing investment also a source of strength, supported by population growth and low mortgage rates. Inflation remains at their 2.0 percent target, the bank said, consistent with an economy operating at near capacity. Based on these assessments, the BoC considered it appropriate to hold rates steady and said future decisions will be guided by the impact of trade conflicts as well as developments in fiscal policy.
 Big global data in the week were capped by US employment on Friday in results that were much stronger than expected and which point to no further US rate cuts, at least for now. The US unemployment rate edged 1 tenth lower in November to a 50-year low of 3.5 percent, a level first reached back in September. At the same time wage data showed some lift led by a sharp upward revision to October to a 3.2 percent growth rate for average hourly earnings. Though this is a moderate rate, as is November's 3.1 percent rate to $28.29 per hour, the combination of rising wages with falling unemployment, as tracked in the accompanying graph, is certain to raise questions at the Fed whether businesses, scrambling to find workers, may be beginning to bid up wages and will inevitably bid them up further. Nonfarm payrolls in November's report rose 266,000 to far surpass expectations and included an outsized 38,000 gain for professional & business services that points to stretched capacity in the labor market (employers turning to contractors). Payrolls were also led by a 54,000 rise for manufacturing that included a 41,000 gain for motor vehicle payrolls on resolution of the GM strike that reversed a 43,000 drop in October. For retailers, the payroll and wage gains are positives for the holiday shopping outlook while for Fed policy makers, who stepped aside to neutral at their October meeting, the results will not raise much resistance to an extension of their wait-and-see strategy.
 Led by gains for purchasing manager indexes from China, the week opened as it closed, with important indications of emerging economic strength. The global composite combines various PMI readings for a seven tenths gain in November to 51.5 and the best showing since July. The pickup was led by acceleration in service activity, especially in China, while manufacturing was highlighted by strength in Greece, Colombia and Brazil. Yet PMI levels near 50 mean that the spread between growth and no growth among these samples is marginal at the very most, and despite November's improvement, export orders, in contrast to domestic orders, held down the improvement. And the distribution of growth among countries is also mixed, with the Czech Republic at the rear for manufacturing along with, as shall we, Germany as well.
 Manufacturing orders were softer than expected in Germany. Although September's monthly rise was revised up to 1.5 percent, strength did not extend to October when orders fell 0.4 percent for their fourth decrease of the last six months. And annual growth, as tracked in the graph, slipped from minus 5.1 percent to minus 5.7 percent for the 15th straight month of contraction. Weakness in October was centered in domestic orders which fell a monthly 3.2 percent though the overseas market did post a second successive 1.5 percent gain and now stands at its best level since June. Within overall orders, intermediates rose 0.7 percent and consumer goods were up 0.3 percent but gains here were outweighed by a 1.1 percent fall in capital goods, a decline that adds to concerns over business investment. Though strength for export orders is a positive indication, the weakness in German domestic demand is not a positive making near term prospects for industrial production look fragile.
 Orders precede production and production data from Germany opened the fourth quarter on a decidedly unfavorable note. Following a 0.6 percent monthly drop in September, production fell an unexpected and very sizeable 1.7 percent in October. This is the fourth decrease in the last five months and the worst performance since April. Compared with a year ago, production was off some 5.3 percent in what is the 12th straight month of contraction. Manufacturing output, which makes up the bulk of the production report, dropped 1.6 percent in October, making for a cumulative 3.0 percent slump over the last two months. The monthly headline slide was led by capital goods which nosedived 4.4 percent and more than eclipsed gains in intermediates (1.0 percent) and consumer goods (0.3 percent). The October report was disappointingly weak and strongly suggests that the goods producing sector will end the year mired in recession, or at least not emerging from it. Total industrial production was 1.9 percent below its third quarter average and is now at its lowest level since November 2016. For the European Central Bank, which meets in the coming week, German production will be a principal area of concern.
 Goods production is an area of concern for all major central banks, the result of what appears to be emerging contraction underway in cross border global trade. This is certainly true with the US as exports slipped 0.2 percent on a monthly basis in October for annual contraction, as tracked in the red line of the graph, of 1.4 percent. Imports fell 1.7 percent in October with annual contraction here at 4.7 percent. Exports of foods, which are in special focus amid ongoing tensions with US trading partners, fell 2.6 percent in the month to the lowest level so far this year, at $10.5 billion. Exports of capital goods, consumer goods, and vehicles also fell in the month, offset in part by a rise for industrial supplies. Yet however downbeat these readings are, they actually equate to great strength for how GDP is calculated as the decline in exports was well exceeded by the decline in imports. As for China, the bilateral gap with the US has not changed much since May, averaging $31.3 billion per month which was the exact deficit for October. The monthly US deficit with Europe widened to $16.4 billion, versus $13.7 billion in September, while the deficit with Japan held steady at $5.1 billion.
 A big lead in the polls for Prime Minister Boris Johnson made for a big drop in the FTSE, falling 1.5 percent in the week and 1.7 percent on Tuesday after a YouGov poll put the Tory's lead over the Labour Party at 9 percent. However friendly conservatives may be toward business, their big lead in the polls tripped a 1.6 percent rally in the week for sterling — and higher sterling spells troubles for UK exports, hence the decline for stocks. As far as Brexit goes, a Tory win would appear to raise the odds for a soft and orderly exit from Europe and perhaps would mark the final chapter of this extended saga. Stocks in Australia also fell sharply in the week, down 1.9 percent and not helped by the Reserve Bank of Australia's decision to hold rates steady at their Tuesday meeting followed on Wednesday by unexpectedly weak GDP data in the September quarter. In contrast to the RBA's forecast for 3.0 percent 2020 growth, GDP managed only a 1.7 percent yearly rate and was held back by a slowdown in household consumption, a slowdown that may be extending into the fourth-quarter based on unexpectedly weak retail sales data for October that followed on Thursday. Turning to gainers in the week, they were led by the Shanghai Composite, up 1.4 percent and apparently reflecting expectations for an agreement to emerge in trade talks with the US. Yet news on this front was uneven. President Trump said on Tuesday that he might prefer to delay an agreement until after the November 2020 US election, in contrast to subsequent reports that talks between the two sides have been going well. Trump's economic advisor Larry Kudlow ended the week saying negotiations in fact are progressing "nicely" though he warned that tariff hikes might nevertheless go into effect on the 15th of this month and that there are no plans for the presidents of the two countries to meet.
December 15th may well prove to be a pivotal date for the markets, as well as December 12th and the UK election. Both of these dates center on the new trend that has taken hold of the global economy over the last several years: concentration on domestic interests and the need for trade restrictions. Thus far, this trend hasn't hurt global employment though the health of global manufacturing is still in question.
**Jeremy Hawkins and Brian Jackson contributed to this article
The week opens with a bang: Chinese trade data on Monday which are expected to improve followed on Tuesday by Chinese inflation data, both consumer and producer prices and here sharply mixed results are the expectations. There will be no let up at midweek as the Federal Reserve issues a policy announcement on Wednesday with expectations uniform for no change. And expectations are also uniform for the Swiss National Bank and European Central Bank both on Thursday where no action is also the call. Industrial production will be an extended theme in the week, posted by France, Italy and the UK all on Tuesday and by the Eurozone on Thursday; here too expectations are uniform — all weak. Other data will include the latest ZEW expectations survey out of Germany on Tuesday and the fourth-quarter Tankan sentiment report from Japan on Friday. The week caps off with no less than US retail sales on Friday, in a report for November that will offer the first definitive data on the 2019 holiday shopping season.
Chinese Merchandise Trade Balance for November (Sun GMT; Mon CST; Sun EST: Release Time Not Set)
Consensus Forecast: US$44.50 billion
Exports, Year-on-Year: 0.7%
Imports, Year-on-Year: -2.5%
The November consensus for China's merchandise trade balance is a surplus of US$44.50 billion following a $42.81 billion surplus in October. Imports in November are seen falling a year-on-year 2.5 percent in US dollar terms following October's 6.4 percent drop while exports are expected to increase 0.7 percent versus a decline of 0.9 percent in October.
Chinese CPI for November (Tue 01:30 GMT; Tue 09:30 CST; Mon 20:30 EST)
Consensus Forecast, Year-over-Year: 4.3%
Disruptions in pork supply have been driving Chinese consumer prices higher. The year-on-year consensus forecast for November consumer prices is 4.3 percent, up sharply from October's higher-than-expected 3.8 percent.
Chinese PPI for November (Tue 01:30 GMT; Tue 09:30 CST; Mon 20:30 EST)
Year-over-Year, Consensus Forecast: -1.7%
Year-on-year producer prices fell a nearly as-expected 1.6 percent in October. For November, forecasters are calling for 1.7 percent contraction.
French Industrial Production for October (Tue 07:45 GMT; Tue 08:45 CET; Tue 02:45 EST)
Consensus Forecast, Month-to-Month: 0.1%
Industrial production is expected to increase a monthly 0.1 percent in October after rising 0.3 percent in September that followed, however, a 0.9 percent drop in August. Year-on-year, French industrial production was up only 0.1 percent in September.
Italian Industrial Production for October (Tue 09:00 GMT; Tue 10:00 CET; Tue 04:00 EST)
Consensus Forecast, Month-to-Month: -0.2%
Italian industrial production in September fell an as-expected 0.4 percent to reverse August's 0.4 percent gain. A monthly drop of 0.2 percent is the forecast for October.
UK GDP for October (Tue 09:30 GMT; Tue 04:30 EST)
Consensus Forecast, Month-to-Month: 0.0%
Consensus Forecast, 3-month to 3-month: 0.1%
The consensus for October GDP is no change versus 0.1 percent declines in both September and October that marked the first back-to-back declines in more than two years. On a 3-month basis, a 0.1 percent gain is expected for October versus a 0.3 percent rise in September.
UK Industrial Production for October (Tue 09:30 GMT; Tue 04:30 EST)
Consensus Forecast, Month-to-Month: 0.2%
Consensus Forecast, Year-over-Year: -1.2%
Manufacturing Production
Consensus Forecast, Month-to-Month: -0.1%
Consensus Forecast, Year-over-Year: -1.6%
Forecasters are calling for a 0.2 percent monthly increase in UK October industrial production and a 0.1 percent decrease for the manufacturing component. September, at minus 0.3 percent overall and minus 0.4 percent for manufacturing, was a second straight month of contraction for this report that was also reflected in annual rates, at minus 1.4 percent and minus 1.8 percent respectively.
Germany: ZEW Survey for December (Tue 10:00 GMT: 11:00 CET; Tue 05:00 EST)
Consensus Forecast, Current Conditions: -21.0
Consensus Forecast, Business Expectations: 5.0
German expectations improved very noticeably in November, to minus 2.1 versus minus 22.8 in October. Yet the assessment of current conditions did not show much improvement, at minus 24.7 versus October's minus 25.3. For December, forecasters see expectations improving to further 5.0 with current conditions, however, still weak at minus 21.0.
Canadian Housing Starts for November (Tue 13:15 GMT: Tue 08:15 EST)
Consensus Forecast: 219,000
Starts in October were weaker than expected at 201,973 and down 8.6 percent on the month. The consensus for November is sharp improvement to 219,000.
Japanese PPI for November (Tue 23:50 GMT; Wed 08:50 JST; Tue 18:50 EST)
Consensus Forecast, Month-to-Month: 0.2%
Consensus Forecast, Year-over-Year: 1.0%
Producer prices in Japan were down 0.4 percent on the year in October, up from minus 1.1 percent in September and benefiting from a 1.1 percent jump in October's monthly rate. For November the call is plus 0.2 percent monthly and plus 1.0 percent on a yearly basis.
US CPI for November (Wed 13:30 GMT; Wed 08:30 EST)
Consensus Forecast, Month-to-Month Change: 0.2%
Consensus Forecast, Year-over-Year Change: 2.0%
CPI Core, Less Food & Energy
Consensus Forecast, Month-to-Month Change: 0.2%
Consensus Forecast, Year-over-Year Change: 2.3%
Consumer prices in the US were steady to mixed in October with the core year-on-year rate edging 1 tenth lower to 2.3 percent, reflecting wide weakness including for apparel but supported by increases in medical care. This rate is expected to hold steady in November at 2.3 percent with the monthly core seen at plus 0.2 percent and also unchanged from October. Overall prices in November are expected to rise 0.2 percent on the month for a 2.0 percent gain on the year.
US Federal Reserve Policy Announcement (Wed 19:00 GMT; Wed 14:00 EST)
Consensus Forecast, Change: 0 basis points
Consensus Forecast, Midpoint: 1.625%
No change is the call for the December policy meeting after the FOMC moved to a neutral stance after cutting rates for a third straight meeting in October.
Japanese Machine Orders for October (Wed 23:50 GMT; Thu 08:50 JST; Wed 18:50 EST)
Consensus Forecast, Month-to-Month: 0.9%
At a month-to-month plus 0.9 percent, forecasters see Japanese machine orders firming in October from September's unexpected monthly drop of 2.9 percent, one that followed a 2.4 percent drop in August. Weakness in September was centered in manufacturing orders which offset a rebound for non-manufacturing orders.
Swiss National Bank Monetary Policy Assessment (Thu 8:30 GMT; Thu 09:30 CET; Thu 03:30 EST)
Consensus Forecast, Change: 0 basis points
Consensus Forecast, Level: -0.75%
The Swiss National Bank is expected to keep its key deposit rate at minus 0.75 percent. At its last meeting in September, the bank retained its assessment that the Swiss franc is still "highly valued" and reiterated its willingness to intervene as and when necessary to prevent any unwanted appreciation.
Eurozone Industrial Production for October (Thu 10:00 GMT; Thu 11:00 CET; Thu 05:00 EST)
Consensus Forecast, Month-to-Month: -0.3%
Consensus Forecast, Year-over-Year: -2.4%
Eurozone industrial production has been on the decline since late last year but the rate of contraction did ease in September, to minus 1.7 percent from minus 2.8 percent in August. But for October, forecasters see yearly contraction deepening back to minus 2.4 percent with monthly change at minus 0.3 percent.
European Central Bank Refi Rate (Thu 12:45 GMT; Thu 13:45 CET; Thu 07:45 EST)
Consensus Forecast, Change: 0 basis points
Consensus Forecast, Level: 0.0%
Deposit Rate
Consensus Forecast, Change: 0 basis points
Consensus Forecast, Level: -0.50%
The European Central Bank is not expected to adjust its policy stance at its December meeting. At its last meeting in October, the bank held policy steady including the refi rate at zero percent and the deposit rate at minus 0.50 percent. As stated at its September meeting, planned QE net asset purchases of €20 billion per month started in November.
Japanese Tankan for the Fourth Quarter (Thu 23:50 GMT; Fri 08:50 JST; Thu 18:50 EST)
Consensus Forecast, Large Manufacturers: 2
Consensus Forecast, Small Manufacturers: -7
Capex Change, Consensus: 6.0%
The Tankan survey is expected to show further deterioration in manufacturing sentiment, at a consensus plus 2 for large manufacturers and minus 7 for small manufacturers, which would compare with third-quarter readings of plus 5 and minus 4. Capex is expected to increase 6.0 percent by March next year versus 6.6 percent in the last report.
US Retail Sales for November (Fri 13:30 GMT, Fri 08:30 EST)
Consensus Forecast, Month-to-Month: 0.5%
Consensus Forecast, Ex-Autos: 0.4%
Consensus Forecast, Ex-Autos & Gas: 0.4%
Consensus Forecast, Control Group: 0.4%
Retail sales have been slowing though improvement is the call for November where Econoday's consensus is a 0.5 percent increase versus a 0.3 percent September gain. Unit vehicle sales rose in November which may hold down ex-auto sales which are expected to rise 0.4 percent. Ex-autos & less gasoline are expected at 0.4 percent as well with the control group also at 0.4 percent.
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