Australian second-quarter CPI, due out on Tuesday, is expected to increase 1.3% quarter-over-quarter, as it did previously. Year-over-year, economists are looking for a 4.3% increase, an uptick from a previous 4.2% rise.

ANZ economists' expectations for the data were in line with the consensus forecast.

"CPI¥ is the key event for local rates markets next week. Given high inflation outcomes around the rest of the world, a genuine surprise would be an easing in inflation. This would see year-end rate cuts priced in more aggressively and the curve steepen," they wrote in a research note to clients.

"As was the case in Q1, we expect the Q2 CPI to be a nasty combination of broad based inflation pressure, stemming from higher input prices, as well as a number of individual items rising by a large amount."

Two days later, the Japanese inflation report is to be released to markets. The Tokyo core CPI for July is forecasted to increase 0.4% year-over-year, an increase from a previous 0.3% rise. The headline index is expected to increase 1.8%, up from a 1.5% rise.

Calyon's chief Japanese economist Susumu Kato argued that the projected 1.8% rise should not be misconstrued as a source of Japanese economic malcontent, referencing Bank of Japan Governor Masaaki Shirakawa's post-BOJ rate decision comments. After the BOJ held rates at 0.50% on June 13, Shirakawa said that there were few second-round inflation effects, adding that inflationary increases due to commodity price surges were bound to subside.

"Given governor Shirakawa's experience as a respected economist, it is an understandable view that second-round inflation would not take place as recent inflation rate is unlikely to trigger wage-inflation spiral in the context of [the] Japanese economy," Kato wrote.

"However, [the] inflation rate for daily necessities has been rising much faster than expected and this should be weighing on consumers' living standards. Although overall core CPI inflation rate is yet within the range of the BOJ's thinking of price stability, a +3.7% inflation rate in May for frequently purchased daily necessities should garner more attention in our view."

Also of note in the week, Australian markets will receive second-quarter PPI figures. Economists are looking for a 1.6% quarter-over-quarter increase to go along with a 5.3% annualized increase. Furthermore, the Japanese all industry activity index result for May will be released on Monday, with a 0.4% rise expected, down from a 0.8% climb in April.

All times in EDT

Sunday: Casting a shadow over new motor vehicle sales, Australian PPI is expected to slow to a 1.6% increase on a quarterly basis, down from a first-quarter 1.9% increase. Annualized PPI is forecasted to increase 5.3%, up from a previous 4.8% increase.

21:30 AU Producer Price Index (Q/Q) Q2 Exp: +1.6% Prior: +1.9%

21:30 AU Producer Price Index (Y/Y) Q2 Exp: +5.3% Prior: +4.8%

21:30 AU New Motor Vehicle Sales (M/M) June Prior: -1.6%

21:30 AU New Motor Vehicle Sales (Y/Y) June Prior: +2.6%

Monday: The Japanese all industry activity index will be released to markets, with a 0.4% month-over-month incline expected.

19:50 JP All Industry Activity Index (M/M) May Exp: +0.4% Prior: +0.8%

Tuesday: Australian CPI remains a huge market focus this week. A second-quarter 1.3% quarterly increase is expected, along with a 4.3% annualized increase. The Reserve Bank of Australia's trimmed mean and weighted median figures are scheduled to be released in tandem with the index's headline inflationary result.

1:00 JP Supermarket Sales (Y/Y) June Prior: -1.1%

3:00 JP Convenience Store Sales (Y/Y) June Prior: +3.7%

21:00 AU DEWR Skilled Vacancies (M/M) July Prior: -0.1%

21:30 AU Consumer Prices (Q/Q) Q2 Exp: +1.3% Prior: +1.3%

21:30 AU Consumer Prices (Y/Y) Q2 Exp: +4.3% Prior: +4.2%

21:30 AU RBA Trimmed Mean (Q/Q) Q2 Exp: +1.1% Prior: +1.2%

21:30 AU RBA Trimmed Mean (Y/Y) Q2 Exp: +4.2% Prior: +4.1%

21:30 AU RBA Weighted Median (Q/Q) Q2 Exp: +1.1% Prior: +1.3%

21:30 AU RBA Weighted Median (Y/Y) Q2 Exp: +4.4% Prior: +4.4%

Wednesday: Both the total and adjusted Japanese merchandise trade balances for June will be released.

19:50 JP Merchandise Trade Balance Total June Exp: +¥506.0B Prior: +¥365.6B Revised:+ ¥362.2B

19:50 JP Adjusted Merchandise Trade Balance June Exp: +¥270.0B Prior: +¥642.3B

21:00 JP BOJ Board Member Atsushi Mizuno to Speak in Aomori City

Thursday: As with Australian CPI, markets will pay great attention to the Japanese numbers due out on Thursday. Tokyo consumer prices are expected to increase 1.8% year-over-year in July. Excluding food and energy, the index is expected to increase 0.4%, up from a 0.3% climb. The lagging national index, meanwhile, is forecasted to post an annualized 1.9% headline increase, up from a previous 1.5% rise. The market consensus is for the core component to come flat over the same time frame.

19:30 JP Tokyo CPI (Y/Y) July Exp: +1.8% Prior: +1.5%

19:30 JP Tokyo CPI Ex-Fresh Food (Y/Y) July Exp: +1.6% Prior: +1.3%

19:30 JP Tokyo CPI Ex Food, Energy (Y/Y) July Exp: +0.4% Prior: +0.3%

19:30 JP National CPI (Y/Y) June Exp: +1.9% Prior: +1.3%

19:30 JP National CPI Ex-Fresh Food (Y/Y) June Exp: +1.9% Prior: +1.5%

19:30 JP National CPI Ex Food, Energy (Y/Y) June Exp: 0.0% Prior: -0.1%

19:50 JP Foreign Buying Japan Bonds W/E July 18 Prior: +¥528.2B

19:50 JP Foreign Buying Japan Stocks W/E July 18 Prior: -¥242.4B

19:50 JP Japan Buying Foreign Stocks W/E July 18 Prior: +¥12.9B

19:50 JP Japan Buying Foreign Bonds W/E July 18 Prior: -¥58.4B

19:50 JP Corporate Services Price (Y/Y) June Exp: +0.6% Prior: +0.6%

Friday: No data is expected to be released in Japan or Australia

By Ryan Szporer, This email address is being protected from spam bots, you need Javascript enabled to view it , edited by Cristina Markham, This email address is being protected from spam bots, you need Javascript enabled to view it

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