Diary: Aussie Rates, Bank Profits, US Jobs, Earning, Chinese Manufacturing

The Reserve Bank dominates the coming week in Australia.

But the April jobs report and a host of other data is out in the US will keep us interested.

And there's also the French presidential poll next Sunday and the Greek national elections which will focus attention at the end of the week and could rattle markets.

Australian markets will also be focused on the interim results from the ANZ on Wednesday and Westpac on Thursday.

The European Central Bank meets, but the poll in France will hold the attention, especially if it looks as though President Sarkozy is going to lose.

Monthly surveys of manufacturing and service activity will be released: watch the two surveys for China tomorrow; they will be vital to local sentiment.

In Australia, there's only one story this week of any importance and that's tomorrow's Reserve Bank board meeting which will cut interest rates.

But while a rate cut will happen, we would be mad to ignore the PMIs in China because of the importance to our economy's outlook.

The RBA will be watching Europe and China and will cut the cash rate by at least 0.25% to 4%, while keeping something in hand if the worsening political outlook in Europe starts weakening the already recession economies.

The AMP's Dr Shane Oliver says the big issue for the RBA is by how much rates should be cut.

He says it's likely the RBA Board will spend much time debating this.

"While the absence of a major crisis probably means the RBA will stick to a 0.25% cut it should be cutting by 0.5%.

"An 0.25% cash rate cut will probably just see the banks cut by between 0.1 to 0.15% which will only take mortgage rates back to around where they were earlier this year, which wouldn't be enough to have much economic impact.

"By contrast a 0.5% cash rate cut would see mortgage rates -fall by around 0.35% which may go some way towards starting to restore confidence and decent growth in the economy.

"But whether its 0.25% or 0.5% on Tuesday, our assessment is that mortgage rates need to fall by around 0.75%, implying several cuts in the cash rate over the next few months."

House price indexes for the March quarter are out tomorrow and are likely to be flat, although some growth could be seen in Sydney.

Private credit data for March will be released by the RBA later today and the Commodity Price Index for April is out on Wednesday.

On Friday the RBA releases the second Statement of Monetary Policy for 2012, with its new forecasts for inflation and economic growth.

Both are expected to lowered.

Besides the house price index, we will also get data on new home sales for March later today.

Car sales data will also be out in Australia later in the week (Thursday or Friday).

The PMI business conditions surveys for China (out tomorrow) are expected to confirm Chinese growth has bottomed.

PMI's are also out for Australia (tomorrow), the rest of Asia, the major European economies and the US.

The same surveys for service sectors in the various economies are out later in the week.

In the US the major release is the jobs data for April will be released on Friday night, our time.

Economists are paring back their expectations to reflect a slower rate of job growth of about 159,000 non-farm payrolls. Other forecasts are as high as 175,000.

Car sales data out in the US tomorrow night, our time.

A rise of just over 2% is tipped by US analysts.

Regional manufacturing surveys point to a slight fall in the US manufacturing survey (due Tuesday night).

Data for personal spending (tonight), the ISM services index (Thursday) and productivity (Thursday) will also be released.

The data on personal spending will see a round of new estimates for first quarter economic growth issued after the 2.2% (annual) figure was released on Friday.

US earnings reports are due from pharmaceutical giant Pfizer and credit card companies Visa and MasterCard.

Media giants CBS Corp and its owner Viacom also report, as do cable providers Cablevision Systems and Time Warner.

Car giant GM is expected to have a solid quarter, thanks to sales in China, while insurers AIG and Allstate, and consumer food giant Kraft Foods, beer giant Anheuser-Busch InBev, Loews, BP, Barrick Gold and Berkshire Hathaway all report this week as well.

As of Friday, 57% of the S&P 500 companies had reported first-quarter results.

And of those 287 in the S&P 500 that had reported earnings, 72.8% posted results that topped analysts' expectations, according to Thomson Reuters.

In Europe, the ECB should be cutting interest rates (currently 1%) when it meets Thursday given the ongoing recession in eurozone countries, but is likely to do nothing

ECB President Mario Draghi may give more detail to his recent comment about Europe needing a growth pact, although the situations in France and Spain (where nearly one person in four are unemployed) will dominate attention.

The French and Greek elections take place Sunday, May 6.

Elections are also due in the German state of Schleswig Holstein.