Due very soon, at 0830GMT the March inflation data from the UK

Along with Retail Sales data for March at the same time (though I have seen reports saying these are due on Thursday? ... any way I am prepared for either Wed or Thurs - bring it!)

I posted previews of each earlier:

More now, these via ...

RBC:

  • After dropping from 3% y/y to 2.7% y/y last time, we look for CPI inflation to have eased again in March, but just by 0.1ppts to 2.6% y/y with petrol prices having come off somewhat.
  • It is a similar story for RPI inflation where we forecast a 0.1ppt reduction to 3.5% y/y.
  • The recently announced price increases by British Gas, of 5.5% for both gas and electricity, don't take effect until the end of May so won't have any impact on the forthcoming release, however, in H2 2018, factoring in this utility bill hike will add an estimated 0.05-0.1ppts to annual CPI rates. It remains to be seen whether other energy providers follow British Gas, but in any case it reaffirms expectations that inflation will remain above the 2% target into 2019.

Scotiabank:

  • This will be the last inflation report before the Bank of England's May 10th decision that is expected to raise borrowing costs. Headline CPI is likely to be little changed in year-ago terms from the 2.7% reading the prior month, and core inflation is likely to remain around 2 ½% y/y.
  • Headline inflation is declining from the 3.1% y/y peak set just a few months ago in November as the effects of prior currency depreciation are dropping out of the numbers. Inflation is likely to settle in just above 2% y/y by year-end into early 2019. As the shock Brexit vote in June 2016 approaches its two year anniversary, pound sterling has almost entirely regained the losses that were incurred in the immediate aftermath of the vote. Sterling's appreciation over the past year will be a lagging dampening influence on inflation going forward which counsels caution for the BoE as it moves toward a near-term rate hike and future guidance.

Daiwa:

  • the latest inflation figures, due on Wednesday, will be no less interesting. Having dropped notably in February from 3.0%Y/Y to 2.7%Y/Y, the headline rate seems likely to have remained unchanged, and we think that the core rate might tick up 0.1ppt to 2.5%Y/Y. However, uncertainty about these estimates appears to be higher than usual, not least given that a number of special factors - very significant base effects in goods price inflation, harsh weather conditions and Easter holidays - affected prices that month.

March retail sales data

  • The latest surveys from this sector suggested that weather affected High Street activity last month, but also that there were strong food sales ahead of the Easter holidays. Overall, we would not be surprised to see a decline in overall sales, in particular given that they rose by a quite firm 0.8%M/M in February. With regard to new Gilts issuance, the DMO will issue 10Y bonds on Thursday.

Oh yeah ... about that headline .... here's a SFW clip ;-)