Week Ahead (31 August)
Tuesday, 1 September - Eurostat to release unemployment data for July
Unemployment data for July will be released by Eurostat on Tuesday. The data release comes as the ECB warned that any economic recovery experienced by the bloc is at risk due to a potential delayed surge in unemployment. Unemployment across EU member states stood at 7.8% in June, and at 7.1% in the Eurozone.
Tuesday, 1 September - Eurostat to release Inflation Flash Estimate for August 2020
Eurostat is due to release its Flash Estimate for the Eurozone for August on Tuesday. The HICP inflation flash estimate was released for July 2020 on 19 August and show that the euro area’s annual inflation rate was 0.4% in July, a 0.1% rise above the 0.3% rate in June. This rate was 1.0% for July 2019, representing a fall of 0.6% year-on-year. Despite the slight rise, the July figures remain far below the ECB’s target of a "below, but close to 2%" medium-term inflation rate.
Wednesday, 2 September - Olaf Scholz to appear before ECON Finance to discuss priorities of German Presidency
The German Finance Minister, Olaf Scholz, will appear before the Committee on Economic and Monetary Affairs on Wednesday. Scholz will discuss the legislative priorities of the German Council Presidency for the second half of 2020, which will include the legislation necessary to underpin the Resilience and Recovery Fund, agreed in July, and the reform of Europe's taxation regime.
It is understood that the European Parliament will seek oversight of the administration of the fund, which may be problematic. Parliament will also seek to introduce safeguards against payments to countries which flout the EU's rule of law requirements.
On taxation, a push towards agreement on new levies, such as a proposed digital tax and financial transactions tax, and the finalisation of the single-use plastics tax, are all expected in the second half of the year.
Thursday, 3 September - France to unveil €100 billion stimulus package
The French government will announce details of its €100 billion stimulus package on 3 September. The package is expected to include €2 billion in support for the cultural sector, according to a radio interview given by France’s Prime Minister, Jean Castex. Castex also reiterated the Government’s promise that no tax hikes will be implemented to fund the stimulus package. According to Castex, France is expecting that funding from the EU’s stimulus package, from which France is expecting to receive €40 billion, will cover the cost.
Castex also said the Government will spend €30 billion this year and a further €8 billion in 2021 on furlough plans to support jobs and salaries at companies experiencing sustained financial difficulty. The 3 September announcement date represents a delay of one week – the package was originally set to be announced on 25 August.
Thursday, 3 September - Eurozone Composite PMI figures for August to be released
Eurozone Composite PMI figures for August are to be released on 1 September (for manufacturing) and 3 September (for services). The flash composite PMI figures for August, released on 21 August, indicate that the rate of growth in the private sector has slowed from last month. The flash Eurozone Composite PMI decreased to 51.6 in August, down from 54.9 in July. The loss of momentum may reflect the resurgence of coronavirus cases in some euro area countries, along with the return of restrictions in such countries.