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Weekly Outlook

Weekly Outlook: US factories surge, oil retreats

Carolane de Palmas
August 07, 2026

              Weekly Outlook

 

What Happened This Week?

 

  • Eurozone
    • Retail sales fell 0.3% in June, with Germany (-1.1%) and France (-0.5%) driving the decline as prolonged Middle East tensions weighed on consumer confidence.
    • Germany’s manufacturing orders unexpectedly jumped 3.1% in June, supported by large orders for machinery, equipment and computer, electronic and optical products.
    • Germany’s industrial recovery still faces risks from extreme heat, with low Rhine water levels potentially reducing economic growth by around 0.3 percentage point this year.

 

  • Switzerland
    • Annual inflation eased to 0.4% in July despite renewed global energy pressures, with lower airfares, diesel and petrol prices driving the decline.

 

  • United Kingdom
    • The World Bank warned that developing economies could benefit more from generative AI than advanced economies, as only 4.5% of jobs in developing countries are considered vulnerable to automation versus 14.2% in richer nations.
    • However, emerging markets risk becoming increasingly dependent on the U.S. and China, which currently dominate the development of advanced AI systems.

 

  • United States
    • Manufacturing activity accelerated sharply in July, with the ISM PMI rising to 55.6 from 53.3, its strongest reading in more than four years. Employment also returned to expansion for the first time in 33 months.
    • The services sector continued to expand, with the ISM PMI edging up to 54.1, although the employment component slipped back into contraction.
    • Initial jobless claims increased slightly to 199,000 in the week through August 1, while continuing claims rose to around 1.8 million, pointing to a still-resilient labor market.
    • Private-sector hiring slowed significantly in July, with ADP reporting only 44,000 new jobs versus 95,000 in June and 75,000 expected. Education and healthcare led job creation, while leisure and hospitality employment declined.
    • U.S. employers announced 33,429 job cuts in July, down 27% from June, suggesting layoffs remain contained despite softer hiring.
    • Kansas City Fed President Jeff Schmid argued that monetary policy may need to become more restrictive, as underlying inflation remains above the Fed’s 2% target and demand and investment remain strong.
    • The Trump administration is seeking to expand a Federal Reserve lending facility that could allow Japan to obtain dollars without selling its U.S. Treasury holdings, raising fresh questions about the Fed’s independence and its relationship with the administration.
    • President Trump has maintained unusually frequent contact with Fed Chairman Kevin Warsh, seeking advice on the economic impact of the Iran conflict and the rapid expansion of AI. Democratic lawmakers are demanding greater transparency over those interactions.
    • Senator Elizabeth Warren called for greater scrutiny of planned changes to the PCE inflation index, which could lower the reported inflation rate by around 0.2 percentage point.

 

  • Canada
    • Services activity remained in contraction, with the S&P Global PMI at 49.1 in July, although firms continued to hire at their fastest pace since May 2023.
    • Input-cost pressures intensified, with services companies reporting their second-fastest increase in prices in more than three and a half years.

 

  • Mexico
    • The central bank kept its benchmark rate unchanged at 6.5% for a second consecutive meeting and pushed back its inflation-target timeline, now expecting 3% inflation only in Q4 2027.
    • The economy rebounded in Q2 following a contraction in Q1, but policymakers continue to see significant downside risks to growth.

 

  • Brazil
    • The central bank lowered its benchmark rate to 14% from 14.25%, delivering its fourth consecutive cut as inflation continues to moderate.
    • Inflation slowed to 4.5% in mid-June, while GDP growth is expected to reach around 2% this year.
    • Policymakers remain cautious as geopolitical uncertainty persists and elevated government spending raises concerns over fiscal risks.

 

  • India
    • The Reserve Bank of India held its repo rate at 5.25% for a fourth consecutive meeting while raising its 2027 growth forecast to 6.7% and lowering its inflation projection to 5%.
    • Higher crude prices remain a key risk for the rupee, which has lost more than 6% against the dollar this year.

 

  • Japan
    • Tokyo is exploring the use of a Federal Reserve dollar-lending facility to support the yen without having to sell U.S. Treasury holdings.
    • The proposal has drawn support from U.S. Treasury Secretary Scott Bessent, who wants to increase the facility’s $60 billion borrowing limit, potentially testing the Fed’s independence under Chairman Kevin Warsh.

 

This Week’s Market Movers

 

Forex

Weekly Outlook: US factories surge, oil retreats
  • The USD/RUB and the EUR/RUB are up more than 2%.
  • The JPY/CHF is up more than 1.5%.
  • The JPY/NZD is up more than 1%.
  • The CHF/ZAR is down more than 1.8%.
  • The NZD/JPY is down more than 0.9%.
  • The USD/JPY is down more than 0.8%.

 

Commodities

Weekly Outlook: US factories surge, oil retreats

 

Indices

Weekly Outlook: US factories surge, oil retreats
  • The KOSPI index is up more than 10.5%.
  • The Nasdaq index is up more than 6%.
  • The Japan 225  index is up more than 5.9%.
  • The VIX index is down more than 22.5%.

 

Shares

 

Tops

 

Flops

 

Important Events to Follow

 

Monday 10 August

  • 11:01 PM - UK - BRC Retail Sales Monitor YoY (July)
    • Previous: 1.7%
    • Forecast: 1.8%

 

Tuesday 11 August

  • 01:30 AM - Australian - NAB Business Confidence (July)
    • Previous: -5
    • Forecast: -6
  • 04:30 AM - Australian - RBA Interest Rate Decision
    • Previous: 4.35%
    • Forecast: 4.35%
  • 02:00 PM - American - Existing Home Sales (July)
    • Previous: 4.09M
    • Forecast: 4.07M

 

Wednesday 12 August

  • 12:30 PM - American - Core Inflation Rate YoY (July)
    • Previous: 2.6%
    • Forecast: 2.5%
  • 12:30 PM - American - Inflation Rate YoY (July)
    • Previous: 3.5%
    • Forecast: 3.4%

 

Thursday 13 August

  • 06:00 AM - UK - GDP Growth Rate YoY Prel (Q2)
    • Previous: 0.9%
    • Forecast: 1.6%
  • 06:00 AM - UK  - GDP MoM (June)
    • Previous: 0.1%
    • Forecast: 0.1%
  • 12:30 PM - American - PPI MoM (July)
    • Previous: -0.3%
    • Forecast: 0.1%

 

Friday 14 August

  • 12:30 PM - American - Retail Sales MoM (July)
    • Previous: 0.2%
    • Forecast: 0.5%
  • 02:00 PM - American - Michigan Consumer Sentiment Prel (August)
    • Previous: 55.2
    • Forecast: 54.6

 

Major Earnings Reports to Watch

 

Monday 10 August

  • AAON

 

Tuesday 11 August

  • Super Micro Computer
  • Phoenix

 

Wednesday 12 August

  • Virgin Galactic
  • Hannover Rueck
  • CISCO
  • ABN AMRO
  • E.ON

 

Thursday 13 August

  • JD.com
  • ThyssenKrupp
  • RWE

 

Friday 14 August

  • Henkel AG & Co

 

Source: The Wall Street Journal, Investing, Trading Economics, Reuters, TradingView and ActivTrades’ Data as of August 07, 2026

 

 

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Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk. Forecasts are not guarantees. Rates may change. Political risk is unpredictable. Central bank actions may vary. Platforms’ tools do not guarantee success.