The world economy is approaching the northern hemisphere winter in disarray, unable to shake off the coronavirus crisis amid persisting supply disruptions, soaring prices and resurgent outbreaks.
Global surveys of purchasing managers this week are likely to point that way. Among the outcomes anticipated by economists are slowing manufacturing and services activity throughout the euro zone and the UK, and only modest improvement in the US.
With parts of Europe confronting renewed restrictions to contain another wave of the virus, China's rebound fading and rising infections taking hold in America too, much of the global economy is now staring at the threat of a second northern winter of woe, compounded by a cost-of-living squeeze amid surging gas prices and supply bottlenecks.
Europe is at the sharper end of the advanced-world wedge. Record infections in Germany might push authorities to announce new lockdowns, and Austria has already done just that. The continent as a whole is enduring a painful peak in consumer prices.
In the US, meanwhile, former Treasury Secretary Lawrence Summers said he sees no more than a 15% chance that "it's all going to work out well," with the probabilities much greater for either stubbornly high inflation or a slump in growth.
The extent to which such outcomes play out will inform monetary policy deliberations on the speed of stimulus withdrawal across the Group of Seven, culminating in a grand finale of decisions in mid-December. That's when central banks, including the US Federal Reserve, hold their final meetings of the year.
Elsewhere this week, monetary officials in New Zealand and South Korea may raise interest rates, and minutes of the most recent meetings of the Fed and the European Central Bank will be released.
A pre-holiday feast of economic data and a possible announcement on President Joe Biden's choice to lead the Federal Reserve will be laid out for investors over the coming week.
The government's report on personal income and spending, which includes an inflation measure tracked by the Fed, will be the main course on data-heavy Wednesday before markets close the following day for Thanksgiving.
Other releases on Wednesday include durable goods orders, revised third-quarter economic growth, new-home sales, merchandise trade, and a final read on consumer sentiment. Existing home purchase data and surveys on November manufacturing and services will surface earlier in the week.
Also on Wednesday, the Fed will release minutes of its early-November policy meeting in which the US central bank announced it would start reducing asset purchases.
Meantime, the White House says Biden will announce whether he'll renominate Jerome Powell to a second term as chair of the central bank, or opt for Fed Governor Lael Brainard instead.
The Reserve Bank of New Zealand and the Bank of Korea are both expected to raise interest rates for the second time since the pandemic as they lead the pack in Asia taking action to step back from full-throttle stimulus and get ahead of the curve in stemming any inflation risks.
Preliminary South Korean trade figures should back up the case for a hike even if they show signs of stabilizing from stellar year-on-year gains.
Reserve Bank of Australia officials will be speaking on panels and may shed some light on how strongly the central bank will stick with its back-of-the-rate-hike-pack stance.
Tokyo inflation figures at the end of the week will show if Japan is seeing more signs of a pickup in prices as energy costs soar. China sets its loan prime rate on Monday and Sri Lanka sets rates on Thursday.
Europe, Middle East, Africa
With more than two weeks left before ECB officials enter the quiet period before their all-important decision on the future of stimulus, comments from several of them may rivet investors. President Christine Lagarde will be among the policy makers speaking.
The ECB will also release an account of its previous meeting in October, when Lagarde and colleagues struggled to convince financial markets that bets on an interest-rate hike in 2022 to tame inflation were probably misplaced.
Aside from the monthly purchasing manager survey results due across the continent, Germany's Ifo index on Wednesday will provide another snapshot of Europe's biggest economy -- just as it reels from ongoing supply interruptions, new infections, and a political system in flux amid continued coalition negotiations.
The Bank of England's decision in December looks laden with suspense on whether policy makers will raise interest rates. Public remarks in the coming week by Governor Andrew Bailey and a couple of colleagues might therefore attract attention.
Over the weekend, Bailey told the Sunday Times that UK economic activity is slowing even as prices rise, underlining the "two-sided" debate over inflation.
Sweden's central bank will make its final monetary decision of the year on Thursday. With the Riksbank expected to keep its interest rate unchanged at zero for some time, the focus is likely to be on whether it will signal a hike by the end of 2024.
Further afield, Israel is expected to keep borrowing costs on hold on Monday due to strong growth and slowing inflation, driven in large part by the shekel.
In Russia, weekly inflation on Wednesday will be watched closely for any clues on whether price pressures are beginning to ease, as many economists have forecast.
Policy makers in Ghana are expected to leave interest rates on hold on Monday, after inflation accelerated to a 15-month high in October. Nigeria's central bank is also expected to stand pat on Tuesday, as inflation moderates and after economic growth slowed in the third quarter.
Argentina's budget balance data due Monday should underscore the challenge of putting its debt back on a path to sustainability. Falling case numbers in Mexico have seen same-store sales rebound, a likely harbinger of stronger September retail sales readings out Tuesday.
Economic activity in Argentina has been surprising analysts to the upside since mid-year, and has returned to its pre-pandemic level. Analysts see additional growth in the September figures.
Look for Brazil's mid-month consumer price data out Thursday to push higher from mid-October's 10.34% print. Yet after a sustained rise since May 2020, some deceleration is seen ahead: Economists surveyed by the central bank see year-end inflation at 9.77%, while the central bank puts it at 9.5%.
In Mexico, final third-quarter output data is expected, with all indications still pointing to a solid 2021 rebound. Economists see mid-month inflation rising sharply, consistent with Banxico Deputy Governor Jonathan Heath's view that it may hit 7.3% by year-end.
Lastly, Banxico posts the minutes of its Nov. 11 meeting where it hiked the key rate a quarter-point for a fourth straight time to 5%.
— With assistance by Vince Golle, Malcolm Scott, Robert Jameson, Benjamin Harvey, and Zoe Schneeweiss
Disclaimer: This opinion first appeared on Bloomberg, and is published by special syndication arrangement.