The first day of this week was relatively calm with regard to macroeconomic releases, however, it’ll change from today as quite many readings are scheduled to be printed later in the day. Probably the most important figures will come from the UK as both CPI and PPI metrics are on the calendar.
- 8:00 am BST - Spanish HICP: The most recent ECB’s meeting was quite a non-event bringing not many hawkish remarks beyond those which had been already priced in. Draghi seems to be still worried about lack of a self-sustaining trend in inflation despite a fairly broad-based improvement of economic activity. Hence, inflation metrics remain one of the most critical for investors as changes in inflationary trends could steer the ECB’s policy going forward. The consensuses point to readings at 0% and 2% in a monthly and annual basis respectively.
- 9:30 am BST - UK’s inflation: Since the UK has decided to vote for leaving the EU the pound has tumbled substantially what has been expected to have much more inflation pressure being just around the corner stemming from the weaker GBP. It’s actually happened. April’s figures showed CPI quite much above the BoE’s objective what, along with sluggish economic momentum, could raise concerns regarding a stagflation scenario. Let us recall that the BoE’s meeting will take place on Thursday, so today’s inflation prints could be worth looking at as the BoE might consider changing its mind in that aspect for the sake of the elections’ fallout. CPI’s expectations are 0.2% mom and 2.7% yoy and core CPI are 0.1% mom and 2.4% yoy.
- 10:00 am BST - German ZEW Index: That reading will be relevant for the same reason as Spanish inflation figures. Since Q3 2015 we’ve seen some range-moving in the ZEW index what could call into question a greater rebound in German economic activity. Any weaker releases might translate into declines in the EURUSD as the pair remains significantly overvalued given the interest rate market. The consensus indicates 21.5 pts.
1:30 pm BST - US PPI: Since the beginning of 2016 the trend in US PPI is pretty decent what has been shored up by a larger rebound in commodity prices. However, both CPI and PCE metrics remain quite far away from the FED’s. Given the FED’s meeting being scheduled on Wednesday US PPI print seems to be even more notable. The consensus suggests 0% mom and 2.4% yoy. When it comes to core measures anticipations show 0.2% mom and 2% yoy.
- 9:40 pm BST - oil stocks by the API: The API’s report is followed by the DoE’s reading, and from time to time could turn out to be a good omen with regard to the Wednesday’s release. Keep in mind that the previous’s week report worked out by the API showed a drawdown in stockpiles, however, the DoE’s figures unveiled an unexpected build what battered oil prices. Hence, it’s worth keeping a close eye on such reports every week.