UPCOMING EVENTS:
- Tuesday: Canada CPI.
- Thursday: US Jobless Claims.
- Friday: EZ CPI, US Core PCE.
Tuesday: The Canadian Headline CPI Y/Y is expected to come at 4.2% vs. 4.4% prior, while the M/M reading is seen at 0.5% vs. 0.7% prior. The Core CPI Y/Y is forecasted at 3.9% vs. 4.1% with no forecast for the M/M figure at the moment, although the prior number was 0.5%. The BoC surprised with a rate hike at the last meeting as they weren’t happy with the first quarter inflation and general data trends. Stubbornly high or even higher data may tip the BoC into another hike all else being equal.
Thursday: The US Jobless Claims remain a key data point and a market mover every week as the market and the Fed are particularly focused on the labour market. Initial Claims have been missing expectations for a few weeks now, but Continuing Claims kept on improving week after week. For this week Initial Claims are expected at 264K vs. 264K prior, while Continuing Claims are seen at 1767K vs. 1759K prior.
Friday: The Eurozone Headline CPI Y/Y is expected at 5.7% vs. 6.1% prior, while there are no forecasts for the M/M figure as of now, although the prior number was 0.0%. The Core CPI Y/Y is seen at 5.5% vs. 5.3% prior and no expectations for the M/M reading, although the prior number was 0.2%. There’s also the Unemployment Rate being reported and expected at an unchanged 6.5% reading. The ECB has made it pretty clear that a July hike is basically guaranteed unless there’s a material change in the data, while the September hike is much more debated and will depend on the data.
The US Core PCE Y/Y is expected at 4.7% vs. 4.7% prior, while the M/M figure is seen at 0.4% vs. 0.4% prior. This data is generally less market moving than the timelier CPI report and it shouldn’t change much markets’ expectations given that we will have the NFP and another CPI report before the next FOMC meeting. So, unless there’s a big deviation from the expectations, it won’t be a big deal.
