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The Week Ahead November 10-14, 2014 Poloz’s Christmas Wish List by Avery Shenfeld Economics Avery Shenfeld (416) 594-7356 [email protected] Benjamin Tal (416) 956-3698 [email protected] Peter Buchanan (416) 594-7354 [email protected] Warren Lovely (416) 594-8041 [email protected] Andrew Grantham (416) 956-3219 [email protected] Nick Exarhos (416) 956-6527 [email protected] “We’ll need to see loonie weakness that doesn’t simply capture poor trade prospects” http://research. cibcwm.com/res/Eco/ EcoResearch.html Today’s jobs data, if confirmed in upcoming surveys, took a big step towards fulfilling one of the two items on Bank of Canada Governor Poloz’s Christmas wish list: a healthier labour market. Indeed, the 6.5% jobless rate is only three ticks above our estimate of full employment. One of the remaining sore spots, the fact that total hours worked are little changed since March, is contradicted in the separate survey of employers which didn’t see the same plunge in April. But his second wish — an economy led by trade and capital spending — might be challenged by the recently weaker news on the global economy and, for now, a depressed price for oil. Export growth isn’t just about global conditions, it’s also about Canada’s market share, which has been sliding in the three quarters of our exports that aren’t energy products. Since that was tied to plant closures during a period of Canadian dollar overvaluation, a weaker C$ would be one route to reversing that trend. While the loonie is down 10% in a little over a year, much of the recent weakness is of the wrong colour. Rather than an exogenous move in favour of the US$ that would improve our exports, it’s been tied to a plunge in oil prices and the resulting expectations for weaker Canadian trade balances ahead. So to deliver the Bank of Canada’s second gift, we’ll need to see loonie weakness that doesn’t simply capture poor trade prospects, but an independent move that helps improve those trade fortunes. Alternatively, we could see a steady Canadian dollar alongside a recovery in oil prices that would accomplish the same feat. There are several routes to a return to higher oil prices over the coming few quarters. For one, global demand might not be as weak as the market now fears. Recent production volumes from the likes of Libya, Iraq and Russia could be vulnerable given geopolitical issues in all three. The Saudi’s can’t permanently shutter US shale oil by temporarily depressing prices, and will be motivated, if not yet at the upcoming OPEC meeting, to ease off on their volumes if low prices persist. But would firmer oil prices also bring a stronger C$ that dents Canada’s non-energy exports? That depends a lot on the other key determinants for the loonie — including non-energy resource prices and Canada-US interest rate spreads. Using the sensitivities estimated in an error correction model for the C$, we find that by allowing the Fed to take its overnight rate up 100 bps before moving its own policy rate, the Bank of Canada could roughly offset the impact of a 20% rebound in crude oil (Chart). Today’s jobs data could move up the clock for the first Bank of Canada hike, but US jobs figures are doing the same stateside, and the Bank’s push for export led growth still tilts the odds that it will let the Fed move first. C$: Tighter Spreads Offset Oil Rebound 3 % ch in C $/US$ 2 1 0 -1 -2 -3 -4 20% rise in oil prices 100 bps tighter C da-US bills yields Note: CIBC, based on Issa, Lafrance, Murray, BOC (2005) CIBC World Markets Inc. • PO Box 500, 161 Bay Street, Brookfield Place, Toronto, Canada M5J 2S8 • Bloomberg @ CIBC • (416) 594-7000 C I B C W o r l d M a r k e t s C o r p • 3 0 0 M a d i s o n A v e n u e , N e w Yo r k , N Y 1 0 0 1 7 • ( 2 1 2 ) 8 5 6 - 4 0 0 0 , ( 8 0 0 ) 9 9 9 - 6 7 2 6 1.3% H, M, L = High, Medium or Low Significance Speaker: 2:50 PM Carolyn Wilkins (Sr. Deputy Gov.) 8:30 AM MANUFACTURING SHIPMENTS M/M (Sep) (M) Friday November 14 (Sep) (L) NEW HOUSING PRICES M/M Thursday November 13 Speaker: 11:10 AM Lawrence Schembri (Deputy Gov.) CASH MANAGEMENT BUYBACK (Feb '15 - Feb '16) - $0.5B AUCTION: 30-YR CANADAS $1.4B 201K Wednesday November 12 (Oct) (M) CIBC Remembrance Day (Bond Market Closed) HOUSING STARTS SAAR CANADA Tuesday November 11 Monday November 10 ` 1.1% 200K -3.3% 0.3% 197K Prior (Sep) 10:00 AM WHOLESALE INVENTORIES M/M (Oct) (Oct) (Nov P) (Sep) 9:55 AM MICHIGAN CONSUMER SENTIMENT 10:00 AM BUSINESS INVENTORIES M/M (Oct) 2:00 PM TREASURY BUDGET 8:30 AM RETAIL SALES M/M RETAIL SALES (X-AUTOS) M/M (Nov 1) (Nov 8) 8:30 AM CONTINUING CLAIMS INITIAL CLAIMS Speaker: 12:00 PM Narayana Kocherlakota (Minneapolis) Speaker: 3:00 PM Charles I. Plosser (Philadelphia) AUCTION: 30-YR TREASURIES $16B (Nov 7) 7:00 AM MBA-APPLICATIONS AUCTION: 4-WEEK BILLS $36B (prev) AUCTION: 1-YR TREASURIES $25B AUCTION: 10-YR TREASURIES $24B Speaker: 5:10 PM Eric Rosengren (Boston) Veteran's Day (Treasury Markets Closed) AUCTION: 3-M BILLS $24B, 6-M BILLS $28B AUCTION: 3-YR TREASURIES $26B UNITED STATES (L) (H) (H) (H) (L) (L) (H) (L) (L) Speaker: 9:10 AM James Bullard (St Louis) SAAR = Seasonally Adjusted Annual Rate Consensus Source: Bloomberg Consensus 0.3% 0.3% CIBC 0.2% 87.5 0.3% 0.2% -$111.7B 2320K 280K 0.2% Consensus 0.2% 86.9 -0.3% -0.2% $105.8B 2348K 278K 0.7% -2.6% Prior Week Ahead Calendar And Forecast CIBC World Markets Inc. The Week Ahead—November 10-14, 2014 Week Ahead’s Market Call by Andrew Grantham and Nick Exarhos Following an encouraging week for bulls in Canada, next week should see further momentum in housing starts data released on Monday, where our 201K call is roughly in line with the street. Manufacturing data released on Friday will see the sector close out the third quarter with 1.3% gain in shipments. That’s not far from the consensus view, and a similar gain for volumes would mean that real output is benefitting from the loonie’s diminished value. In the US, it’s a slow start to the week for economic data. Initial claims will continue to be viewed for signs of strength in the labour market. But we’ll have to wait until Friday for the main event of the week – October’s retail sales. Following a disappointing end to Q3, we’re looking for a rebound, even with the headline growth rate restrained by lower gasoline prices. CIBC World Markets Inc. The Week Ahead—November 10-14, 2014 Week Ahead’s Key Canadian Number: Canadian Factory Shipments Manufacturing Shipments—September 5 4 3 2 1 0 -1 -2 -3 -4 -5 (Friday, 8:30 a.m.) Nick Exarhos (416) 956-6527 Manufacturing Shpts, m/m CIBC 1.3% Mkt Prior Sep-12 1.1% -3.3% % % 12 8 4 0 -4 -8 -12 Mar-13 Sep-13 Month/Month (L) Mar-14 Sep-14F Year/Year (R) Source: Statistics Canada, CIBC Forecast Implications—A cheaper loonie is helping support external demand for Canadian products, with goods volume exports up an annualized 10.5% in Q3. More time might be needed to see a meaningful turn in overall capital spending, however, with the recent slump in oil prices likely dampening some enthusiasm for oil patch investment. The unusual pattern to summer auto sector retooling this year created some noise in the monthly surveys of manufacturing output. But by September those effects will have dissipated, and the continued momentum in car lot spending both here and across the border will help give a lift to related Canadian manufacturing. External demand for some other consumer goods, along with metal products, should push factory production higher. A cheaper loonie is helping make Canadian products more competitive, and is raising C$ prices for some non-resource goods. Market Impact—We aren’t very different from the consensus, and wouldn’t as a result expect much market reaction. A gain somewhere in that vicinity for volumes would mean that real manufacturing output in Q3 would have been up by around 2% over the prior quarter. Other Canadian Releases: Housing Starts—October (Monday, 8:15 a.m.) own levels in the near-term. October’s figure will likely to come in at 201K, and the plethora of projects already underway should support the building sector over the next couple of quarters. Residential building permits (units) gained 9.4% in September, taking their six-month average level to around 200K. That choppy but flattish trend in residential building intentions should support housing starts at around their CIBC World Markets Inc. The Week Ahead—November 10-14, 2014 Week Ahead’s Key US Number: 2 Retail Sales—October % US Retail Sales % (Friday, 8:30 a.m.) 8 6 1 Andrew Grantham (416) 956-3219 4 0 2 Retail Sales Retail Sales – ex auto CIBC 0.3% 0.3% -1 Mkt Prior 0.3% -0.3% 0.2% -0.2% 0 Oct-13 Feb-14 m/m % chg. (L) Jun-14 Oct-14F y/y % chg. (R) Forecast Implications—Digging beneath the modest headline gain, consumer spending should appear to be on a slightly firmer footing at the start of Q4, and we expect spending over the quarter as a whole to be stronger than the 1.8% pace recorded in Q3. US consumers kept their wallets in their pockets during September, resulting in a pretty broad-based decline in retail spending. The rebound we expect to see in October will likely look pretty modest at first blush, but that’s because the nominal headline figure will be weighed down by a big reduction in gasoline prices. Market Impact—We are in line with the current consensus for headline sales, but an upside surprise on the core retail measure could be a positive for related equities and the US$, while weighing on fixed income. Digging a little deeper should reveal a more positive result. Electronics sales—the only real bright spot in September —should continue to be supported as households snap up a popular new phone. And the savings consumers continue to make at the pumps should begin to show up in higher spending on other goods as well. A 0.6% rebound in core retailing (excluding autos, gasoline, building materials and restaurants) would be double the 0.3% advance we expect for headline sales. CIBC World Markets Inc. The Week Ahead—November 10-14, 2014 Equity Insights Peter Buchanan Earnings Results Confirm US and UK Strength Hotter Growth Brings Cheer to US and UK Boardrooms The US and UK have been leading the recovery in the industrialized countries, a fact confirmed by the latest earnings reports. No less than 83% of large listed companies in the UK have topped the street so far in Q3, with a majority also outperforming on sales. Even allowing for the consensus’ innate conservatism, the stats stateside have also shone, with four fifths of S&P reporters topping analysts’ expectations. That’s the highest level in four years. Today’s further solid job gain heightens the odds of the Fed tightening next spring. While that’s earlier than the street expects, decent earnings momentum and an improving economy should still create modest upside for stocks. 90 80 70 60 50 40 30 20 10 0 % of components beating EPS consensus in Q3 FTSE 100 S&P 500 Euro Stoxx Nikkei 225 50 Source: Bloomberg, CIBC Non-Resource Earnings Driving Q3 EPS Stronger Non-Resource Earnings Help Offset Commodity Slowdown With two thirds of Composite members having reported, the building blocks for another TSX reporting season are falling into place, and the picture, as in the US, is looking better than analysis had earlier envisioned. The “blended consensus” as of Friday was telegraphing a 14% rise yr/yr, a touch firmer than in Q2 and about 2%-pts above expectations three weeks ago. Helping to fill the slack from weaker resource earnings, profits in a number of other sectors appear to be showing more firepower. That’s a sign the BoC’s efforts to tip the C$ lower are starting to help bottom lines. If that continues, Mr. Poloz and company may not have to wait that long to see factory sector investment pick up. 18 16 14 12 10 TSX C omposite, y/y % ch 8 6 4 2 0 14:Q2 14:Q3 Resource Earnings (Energy & Material) Non-Resource Earnings Miners Could Rally If Metals Prices Don’t Cave Further Source: Bloomberg, CIBC QE is dead, long live QE. Fears over global growth savaged industrial metals prices as the summer waned, but central bankers have lent a modest degree of support lately. Acting just two days after the Fed wrote the epitaph for QE, the BOJ unveiled an aggressive expansion of its asset buying program. That plus softer core inflation data puts more pressure on the ECB to scale up its so far timid foray into the QE waters with outright, Fed-style, bond purchases. TSX diversified metal stocks have sold off much more steeply than base metals prices themselves. Investors appear primed for still worse news ahead. Even if metals prices just hold their own thanks to a healthier US economy and monetary stimulus elsewhere, producers’ shares could consequently enjoy a relief rally. Base Metals Stocks Have Fallen Far More Than Prices Ratio of TSX Diversified Mining Industry to Bloomberg Industrial Metals Index 180 160 140 120 100 stocks "cheapest" relative to prices in half a decade 80 Oct-14 Apr-14 Oct-13 Apr-13 Oct-12 Apr-12 Oct-11 Apr-11 Oct-10 Apr-10 Oct-09 Apr-09 60 Source: Bloomberg, CIBC CIBC World Markets Inc. The Week Ahead—November 10-14, 2014 Currency Currents Andrew Grantham and Nick Exarhos Why BoC Has Shrugged Off Inflation Small Number of Areas Contributing to Inflation Overshoot (L); More Areas Still Seeing Less Than 2% Increases (R) Weighted Proportion of Core CPI With Inflation 70% Above 2% Contribution to Sept Core CPI Y/Y % Chg 2.50 C ommunication (+0.35%-pts) 2.00 60% 50% 40% 1.50 Meat (+0.3%-pts) 30% 20% 1.00 10% Remainder (+1.4%-pts) Mar-14 Jan-13 Nov-11 Jul-09 Sep-10 0.00 May-08 0% Jan-06 0.50 Mar-07 Take a static view of the US and Canadian economies, and you’d be excused to think that Governor Poloz and co. were closer to raising interest rates. If the same methodology were used, the unemployment rates would be almost identical. Meanwhile core CPI is marginally above target in Canada, but core PCE is ½% below the Fed’s 2% goal. However, the BoC believes that much of the inflation overshot in Canada is transitory. Meat and communications—two areas where price trends aren’t likely to persist—are contributing significantly to the overshoot. But digging deeper, there are still fewer sectors experiencing 2%-plus inflation than has been typical. So look for the BoC to maintain a neutral stance, despite today’s employment surprise. Source: Statistics Canada, CIBC Petroleum and Non-Petroleum Deficits Diverge Catching the Dutch Disease? Trade Balance ($ bn) 0 A glance at last week’s US trade figures and you’d be excused to think that the “Dutch Disease” was spreading south of the border. While the shale revolution has limited the US’s reliance on imported oil, the non-petroleum deficit is plumbing the depths. However, that may not necessarily be a reflection that US manufacturers are suffering from a stronger greenback. Rather, it could reflect the fact that US growth and demand is outpacing that elsewhere in the world. As such, it shouldn’t be an obstacle against further US$ strength. Petroleum -10 Ex-Petroleum -20 -30 -40 -50 The Growing Monetary Arrow Sep-14 May-13 Jan-12 Sep-10 May-09 Jan-08 Sep-06 May-05 Jan-04 Sep-02 May-01 Jan-00 -60 Source: BEA, CIBC Japanese policymakers reached back into their quiver last week, and aimed higher. Now, their target is annual monetary base growth of JPY80 tn, a JPY10 tn increase. And chances are skewed toward more skyward arrows, a likelihood expressed by LIBOR spreads which have made carry trades funded with the yen even more attractive. Although BoJ bond buying is insensitive to yield, the Government Pension Investment Fund, with its burden of providing returns for an aging population, isn’t. It’s no surprise then, that it cut its allocation to bonds to 35% from 60%, with more weight now on stocks. Thus, the record JPY1.2 tn in government bond outflows in Q2 may not stand for long. Sharper outflows and monetary action will keep the yen on the back foot. Cheap Yen Funding (L); Record Pension Bond Outflows in Q2 (R) USD minus JPY 6-month LIBOR (bps) 17.5 17.0 16.5 16.0 15.5 15.0 14.5 14.0 13.5 13.0 12.5 12.0 5 4 3 2 1 0 -1 12Q1 12Q2 12Q3 12Q4 13Q1 13Q2 13Q3 13Q4 14Q1 14Q2 -2 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Gov't Bond Pension Flows (JPY tn) Source: Bank of Japan, Bloomberg, CIBC CIBC World Markets Inc. The Week Ahead—November 10-14, 2014 CANADIAN RELEASE AND EVENT DATES November/December 2014 MONDAY TUESDAY 3 WEDNESDAY 4 MERCHANDISE TRADE 8:30 AM $MN 12 MO. BALANCE JUL 2,009 2,401 AUG -464 2,597 SEP 710 3,031 THURSDAY 5 INTERNATIONAL RESERVES 8:15 AM $BN $BN CHANGE LEVEL AUG 0.148 75.6 SEP -1.927 73.7 OCT 0.225 73.9 FRIDAY 6 BUILDING PERMITS ($) 8:30 AM M M (RES)(NON-RES) JUL 17.3 5.6 AUG -15.5 -41.1 SEP 6.1 23.9 IVEY PURCHASING MANAGERS’ INDEX 10:00 AM 10 HOUSING STARTS 8:15 AM 000’s (AR) TOTAL SINGLES AUG 196 64 SEP 197 62 OCT 17 11 12 NEW HOUSING PRICE INDEX 8:30 AM REMEMBRANCE DAY (HOLIDAY) (Bond Market Closed) 18 19 INT’L TRANSACTIONS IN SECURITIES C$BN, NET 8:30 AM BONDS MONEY S TOCKSTOT MARKET JUL 2.5 -1.9 4.6 5.2 AUG 4.3 3.7 2.3 10.3 SEP 24 13 20 WHOLESALE TRADE 8:30 AM 25 27 26 BALANCE OF INT’L PAYMENTS 8:30 AM CURR. ACCT. BAL. $BN(QR) $BN(AR) 14:Q1 -12.0 -48.1 14:Q2 -11.9 -47.5 14:Q3 RETAIL TRADE 8:30 AM (Current$) M Y JUL -0.1 5.0 AUG -0.3 4.4 SEP Payroll employment, Earnings & Hours 8:30 AM 7 LABOUR FORCE SURVEY 8:30 AM AVG EMPLOYUNEMP HRLY (HSHOLD) RATE EARN M Y % Y AUG -0.1 0.5 7.0 2.3 SEP 0.4 0.8 6.8 2.1 OCT 0.2 1.0 6.5 1.9 14 SURVEY OF MANUFACTURING 8:30 AM SHIPMENTS M Y JUL 2.9 8.5 AUG -3.3 6.1 SEP CONSUMER PRICE INDEX 8:30 AM M(NSA) AUG 0.0 SEP 0.1 OCT 21 Y 2.1 2.0 28 NATIONAL ACCOUNTS 8:30 AM REAL PRICE GDP DEFLATOR %ch AR %ch AR 14:Q1 0.9 5.9 14:Q2 3.1 0.7 14”Q3 GDP BY INDUSTRY 8:30 AM (2002$) GDP IND.PROD. M M JUL 0.0 -0.4 AUG -0.1 -1.0 SEP INDUSTRIAL PRICES 8:30 AM M(NSA) Y AUG 0.3 2.6 SEP -0.4 2.5 OCT WAGE SETTLEMENTS 10:00 AM (%) PVT. PUB. TOT. AUG 2.4 1.5 2.1 SEP 1.7 1.3 1.4 OCT 1 2 4 3 INTERNATIONAL RESERVES 8:15 AM $BN $BN CHANGE LEVEL SEP -1.927 73.7 OCT 0.225 73.9 NOV Bank of Canada Interest Rate Announcement IVEY PURCHASING MANAGERS’ INDEX 10:00 AM 5 LABOUR FORCE SURVEY 8:30 AM AVG EMPLOYUNEMP HRLY (HSHOLD) RATE EARN M Y % Y SEP 0.4 0.8 6.8 2.1 OCT 0.2 1.0 6.5 1.9 NOV LABOUR PRODUCTIVITY 8:30 AM MERCHANDISE TRADE 8:30 AM $MN 12 MO. BALANCE AUG -464 2,597 SEP 710 3,031 OCT All data seasonally adjusted except where noted “NSA”. M: per cent change from previous month. Q: per cent change from previous quarter at annual rates. Y: per cent change from year earlier. AR: Annual Rate. YTD: Year to date. Release dates are provided by sources outside CIBC World Markets Inc. Dates are subject to change. Sources for historical data: Statistics Canada, CMHC, Human Resources Development Canada and the Bank of Canada. CIBC World Markets Inc. The Week Ahead—November 10-14, 2014 U.S. RELEASE AND EVENT DATES November/December 2014 MONDAY TUESDAY 3 ISM MFG SURVEY 10:00 AM COMP. PRICES INDEX INDEX AUG SEP OCT 59.0 56.6 59.0 58.0 59.5 53.5 LIGHT VEHICLES SALES MIL (AR) Y AUG 17.439 9.9 SEP 16.329 6.4 OCT 16.349 7.0 WEDNESDAY 4 GOODS & SERV. BALANCE (BOP) $B 8:30 AM GDS SERV TOT JUL -59.8 19.5 -40.3 AUG -60.2 20.2 -40.0 SEP -62.7 19.6 -43.0 FACTORY ORDERS 10:00 AM M(SA) Y(NSA) JUL 10.5 15.7 AUG -10.0 4.2 SEP -0.6 1.9 BOT (9:00) REDBOOK (8:55) VETERAN’S DAY (HOLIDAY) (Treasury Markets Closed) 3-Yr NOTE AUCTION 5 ADP SURVEY 8:15 AM ISM NON-MFG SURVEY 10:00 AM 3, 10-Yr NOTE ANNOUNCEMENT 30-Yr BOND ANNOUNCEMENT 11 10 THURSDAY 18 CAPACITY UTIL/IND. PROD. 9:15 AM LEV M Y AUG 78.7 -0.2 4.0 SEP 79.3 1.0 4.4 OCT PPI 8:30 AM M (SA) AUG -0.4 SEP -0.2 OCT Y (NSA) 2.2 2.1 NET CAPITAL INFLOWS TICS 4:00 PM 3, 10-Yr NOTE SETTLEMENT 30-Yr BOND SETTLEMENT 24 25 CORPORATE PROFITS 8:30 AM S&P/CASE-SHILLER HOUSE PRICE INDEX 9:00 AM CONSUMER CONFIDENCE 10:00 AM 2-Yr NOTE AUCTION 1 HOUSING STARTS 8:30 AMMIL (AR) AUG 0.957 SEP 1.017 OCT Y/Y 0.7 1.3 0.9 INITIAL JOBLESS CLAIMS (8:30) 13 30-Yr BOND AUCTION TREASURY BUDGET 2:00 PM 10-Yr NOTE AUCTION M -12.8 6.3 8:30 AM AUG SEP OCT CPI M(SA) -0.2 0.1 56.6 59.0 FOMC Minutes BUSINESS INVENTORIES 10:00 AM 20 21 PHILADELPHIA FED INDEX 10:00 AM 27 26 PERS. INC & OUT. 8:30 AM SAVING INCOME CONS RATE M M AR AUG 0.3 0.5 5.4 SEP 0.2 -0.2 5.6 OCT DURABLE GOODS ORDERS 8:30 AM M Y AUG -18.3 8.7 SEP -1.3 3.3 OCT INITIAL JOBLESS CLAIMS (8:30) 2 3 4 NON-FARM PRODUCTIVITY 8:30 AM Q/Q (AR) Y/Y 14:Q2 (R) 2.9 1.3 14:Q3 (P) 2.0 0.9 14:Q3 (R) ISM NON-MFG SURVEY 3, 10-Yr NOTE ANNOUNCEMENT 30-Yr BOND ANNOUNCEMENT Beige Book BOT (9:00) REDBOOK (8:55) 28 CHICAGO PMI 9:45 AM THANKSGIVING DAY (HOLIDAY) (Markets Closed) 10:00 AM 2,5,7-Yr NOTE SETTLEMENT Y 5.0 4.3 2,5,7-Yr NOTE ANNOUNCEMENT 5-Yr NOTE AUCTION LIGHT VEHICLES SALES MIL (AR) Y SEP 16.329 6.4 OCT 16.349 7.0 NOV 14 INITIAL JOBLESS CLAIMS (8:30) BOT (9:00) REDBOOK (8:55) 59.5 53.5 RETAIL SALES 8:30 AM M AUG 0.6 SEP -0.3 OCT Y (NSA) 1.7 1.7 ADP SURVEY 8:15 AM SEP OCT NOV CONSUMER CREDIT 3:00 PM EXISTING HOME SALES 10:00 AM MICHIGAN SENTIMENT (F) 9:55 AM NEW HOME SALES 10:00 AM 7-Yr NOTE AUCTION ISM MFG SURVEY 10:00 AM COMP. PRICES INDEX INDEX 7 EMPLOY. SITUATION 8:30 AM NON- CIV AVG FARM UNEMP HRLY PAYROLL RATE EARN (000s) M % Y AUG 203 6.1 2.5 SEP 256 5.9 2.2 OCT 214 5.8 2.2 MICHIGAN SENTIMENT (P) 9:55 AM INITIAL JOBLESS CLAIMS (8:30) 19 BOT (9:00) REDBOOK (8:55) GDP 8:30 AM (AR) REAL IMPLICIT GDP DEFLATOR 14:Q2(F) 4.6 2.1 14:Q3(A) 3.5 1.3 14:Q3(P) 6 NON-FARM PRODUCTIVITY 8:30 AM Q/Q (AR) 14:Q1 (R) -4.5 14:Q2 (R) 2.9 14:Q3 (P) 2.0 12 BOT (9:00) REDBOOK (8:55) 17 FRIDAY INITIAL JOBLESS CLAIMS (8:30) 5 EMPLOY. SITUATION 8:30 AM NON- CIV AVG FARM UNEMP HRLY PAYROLL RATE EARN (000s) M % Y SEP 256 5.9 2.2 OCT 214 5.8 2.2 NOV GOODS & SERV. BALANCE (BOP) $B 8:30 AM GDS SERV TOT AUG -60.2 20.2 -40.0 SEP -62.7 19.6 -43.0 OCT FACTORY ORDERS 10:00 AM M(SA) Y(NSA) AUG -10.0 4.2 SEP -0.6 1.9 OCT CONSUMER CREDIT 3:00 PM All data seasonally adjusted except where noted “NSA”. M: per cent change from previous month. Q: per cent change from previous quarter at annual rates. Y: per cent change from year earlier. AR: Annual Rate. YTD: Year to date. Release dates are provided by sources outside CIBC World Markets inc. Dates are subject to change. Sources for historical data: U.S. Department of Commerce, U.S. Department of Labor and U.S. Federal Reserve Board. CIBC World Markets Inc. The Week Ahead—November 10-14, 2014 This report is issued and approved for distribution by (a) in Canada, CIBC World Markets Inc., a member of the Investment Industry Regulatory Organization of Canada, the Toronto Stock Exchange, the TSX Venture Exchange and a Member of the Canadian Investor Protection Fund, (b) in the United Kingdom, CIBC World Markets plc, which is regulated by the Financial Services Authority, and (c) in Australia, CIBC Australia Limited, a member of the Australian Stock Exchange and regulated by the ASIC (collectively, “CIBC”) and (d) in the United States either by (i) CIBC World Markets Inc. for distribution only to U.S. Major Institutional Investors (“MII”) (as such term is defined in SEC Rule 15a-6) or (ii) CIBC World Markets Corp., a member of the Financial Industry Regulatory Authority. U.S. MIIs receiving this report from CIBC World Markets Inc. 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