New Zealand Private Sector Labor Cost (QoQ) (3Q) (21:45 GMT; 16:45 EDT)
Consensus:         0.8%
Previous:             0.6%

Outlook:  Wage inflation in New Zealand is expected to have accelerated 0.8 percent during Q3 after slowing to 0.6 percent in Q2. A tight labor market in New Zealand is likely to have helped contribute even more to already strong wage pressures, as unemployment in Q2 hit a record low of 3.6 percent. While Q3 unemployment report is expected to edge up 3.7 percent, the high demand for workers has managed to push another measure of wage growth, the average hourly earnings for non-government workers, up to 1.1 percent in Q3. Subsequently, strong wage growth likely helped CPI to jump an annualized 3.5 percent in Q3. This has been a major cause of concern for Reserve Bank of New Zealand Governor Alan Bollard, who said that cutting rates from a record 7.25 percent â�,��"remains a considerable way offâ�,�, despite weaker economic growth, because inflation refuses to abate.

Previous:  Private sector labor costs in New Zealand rose 0.6 percent during Q2, down from 0.7 percent in Q1 and leaving the annual rate at 3.0 percent. Wages were buoyed by outside factors, as a government report issued in July said that New Zealand had the most labor strikes in nine years between March 2005 and March 2006, as accelerated inflation at 4 percent and a record-low jobless rate of 3.6 percent in Q2 prompted workers to seek higher wages. For example, the Engineering, Printing and Manufacturing Union, the nation's largest, had been campaigning for a 5 percent wage increase for its 50,000 members. As a result of the payroll and CPI growth, the RBNZ was forced to hold rates at a record high of 7.25 percent, despite signs the economy was weakening.

Australian TD Securities Inflation (OCT) (23:30 GMT; 18:30 EDT)
                          (MoM)                    (YoY)
Consensus:          n/a                          n/a
Previous:              0.0%                       3.1%

Outlook:  TD Securities proprietary gauge of inflation for consumer goods in Australia has no consensus attached to either its monthly or annual figures, making the numbers even more market moving.  Coming in ahead of the RBAâ�,��"�s monetary policy meeting, this leading indicator of price pressure will be the last indicator for consideration for another rate hike.  In the previous weeksâ�,��"� data, inflation pressures have not offered the clear hawkish signs policy makers need to pull the trigger on a rate hike.  On the other hand, core prices continued to climb as the third quarter annual reported ticked higher to 2.1 percent.  Looking to October, the absence of the volatile drop in energy prices that was realized in September will allow core goods to take the gauge higher.  Aside from the general strength in the consumer spending encouraging businesses to pass on prices, the carry through effects of Augustâ�,��"�s rate hike in financial costs will help buoy inflation higher.  Particularly interesting for Octoberâ�,��"�s report will be the comparison to the Melbourne Instituteâ�,��"�s consumer inflation expectationâ�,��"�s survey.  According to their report, Australianâ�,��"�s expected inflation to slow to 3.4 percent in the monthâ�,��"�s ahead, the lowest in over a year-and-a-half.  With consumerâ�,��"�s expectations in mind and the potential for a rate hike in mind, the market will be looking for a move higher in inflation.

Previous:  Australian prices passed the month unchanged in September as the drop in energy prices was handily offset by a rise in financial costs.  The monthly print was the first month inflation failed to expand since February and the annual report slowed to 3.1 percent for the slowest pace since April.  During the month, the most influential factor for inflation was an almost 10 percent drop in gasoline prices.  By the end of the month, gasoline dropped continued to ease from its June high to A$1.21.  In fact, when excluding the volatile energy and food products, the core basket actually accelerated to 0.7 percent growth in September, the fastest pace in the measureâ�,��"�s four-year history.  Furthermore, the trimmed down annual report slowed to 2.7 percent expansion. With the report casting doubt on the need for restraint, the RBA decided to keep the overnight cash rate unchanged at 6.00 percent in its early October meeting.

UK Manufacturing Production (SEP) (09:30 GMT; 04:30 EDT)
                           (MoM)                    (YoY)
Consensus:          0.2%                      2.3%
Previous:              0.4%                      1.5%      

Outlook:  Factory activity in the United Kingdom, accounting for 15 percent of the entire economy, is expected to grow 0.2 percent in September.  A number of indicators are supporting the predicted acceleration in output for the month and the subsequent boost to the annual gauge to 2.3 percent.  Over the same period, the CIPS figure of factory activity grew.  More importantly, from the breakdown, the output component printed its highest level since July of 2004.  Furthermore, improvements in the new and export orders sub-gauge provided support that factory activity will be running for some months to come.  Another factory index from the CBI was also making its own 21-month high in September.  As was seen in both of these gauges, a drop in input prices, like the massive drop in energy, will be the engine behind a potential pickup in production.  Continued expansion in the manufacturing sector will help consumer spending and the housing market to hold economic expansion at the highs reporting through the first three quarters of this year.

Previous:  Manufacturing output in the UK grew 0.4 percent in August, double the marketâ�,��"�s expectations leading into the report.  This increase marked the first instance in which factory output in the nation grew four consecutive months since 1999.  During the period, strong exports and falling energy prices were the big boosts to the level of output.  From the 13 industries comprising the manufacturing sector, 10 reported stronger activity levels and there were no large contractions.  The biggest contributor was a healthy 1.8 percent jump in electrical and optical equipment production.  On the other side, the volatile sub-component for oil extraction actually dropped 7.2 percent. 

Canadian Ivey PMI (OCT) (15:00GMT; 10:00EST)                     
Consensus:         57.0
Previous:             59.9

Outlook:  The Canadian purchasing managers index, as measured by the Ivey School of Business in Ontario, is expected to weaken to 57.0 in October from 59.9. The most recent report of Canadian business conditions indicated that manufacturers expect their production to shrink by the largest amount in Q4 since 2001. As a result, declines in PMI will likely be led a fall in supplier-deliveries, suggesting orders took longer to fill, and a lower inventory gauge, as stockpiles likely rose at a slower pace. Additionally, the price components will probably weaken as well, since energy prices continued to weaken throughout the month. Upside risk, however, comes from the labor component, as the net change in employment during the month of October jumped 50.5K, bringing the unemployment rate to drop to 6.2 percent from 6.4 percent.

Previous:  The Canadian Ivey PMI survey accelerated for the first time in four months in September, bringing the figure to 59.9. The index suggests the economy may be rebounding on the back of increased business and government spending after slowing in the second quarter and July. A breakdown of the data showed that the price index fell to 60.7 from 68.6, likely to due to falling energy and resource prices during the month. Meanwhile, the employment index rose to 58.8 from 54.1, signaling more Canadians found work.

Richard Lee is a Currency Strategist at FXCM.