The following is an extract from IHS Markit's latest Week Ahead Economic Preview. For the full report, please click on the 'Download Full Report' link.

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A fully-packed week for economy watchers kicks off with worldwide manufacturing and services PMIs and rounds off with the US jobs report. Interspersed are central bank meetings in the UK, Australia, India and Thailand, where policymakers will be grappling with recent mixed signals on the outlook for global growth, inflation and the path of the pandemic.

July flash PMIs revealed two key themes, namely the detriments of the Delta variant spread, particularly around APAC economies, and sustained supply constraints, limiting capacity and fuelling price pressures. With a greater number of APAC economies feeling the heat from further COVID-19 waves, and developed economies likewise seeing sentiment hit, the global PMIs will unveil the full effect of the Delta wave on the manufacturing and service sectors in July.

Price pressures notably eased in some key economies such as the US and Eurozone, according to flash PMI surveys. July's FOMC meeting meanwhile saw the Fed reiterate their transitory view towards inflation, though await further progress on the economic recovery before making any decisions on tapering. This brings the focus to July's labour market data. As far as our flash US PMI suggested, another round of solid job creation was seen in July.

Finally, the UK and Australia both saw the Delta wave weigh on economic conditions according to flash PMIs. No changes to monetary policy are expected in the UK but the market will be eager to see if there are any splits in the decision to hold.

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PMI commentary: Chris Williamson, Jingyi Pan

Europe commentary: Ken Wattret

APAC commentary: Rajiv Biswas

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Purchasing Managers' Index™ (PMI™) data are compiled by IHS Markit for more than 40 economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies, and are available only via subscription. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment and inventories. The PMI data are used by financial and corporate professionals to better understand where economies and markets are headed, and to uncover opportunities.

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