- UK inflation is expected to accelerate in April
- FOMC minutes to reveal more details when it comes to a future course in monetary policy
- Weekly change of US oil inventories on the agenda this afternoon
9:30 am BST - UK inflation: Admittedly the British pound is being steered by the incoming Brexit revelations, one should not forget about very important macroeconomic readings like the inflation report. The understanding is clear: if the Brexit thread finished, then market participants’ attention will be again paid more to data. Core price growth is expected to have sped up to 1.9% in annual terms compared to 1.8% in March, whereas headline price growth is forecast to have grown 2.2% YoY after rising 1.9% YoY in the previous month.
1:30 pm BST - Canadian retail sales: We have not seen a clear trend in the USDCAD market so far this month. Keep in mind that Canadian monetary policy is strongly dependent on what happens in the US. Hence, the elevated expectations regarding a rate cut in the US (the view does not seem to be shared by the Fed itself) have weighed on the CAD too. Strong macroeconomic readings are necessary to convince the BoC to resume its monetary tightening process. In March headline retail sales are expected to have picked up 1.2% MoM, while core sales (ex. auto) have increased 0.9% MoM.
3:30 pm BST - weekly DoE release: Oil prices have been trading in a consolidation in recent days as concerns surrounding the global economic slowdown have been soothed after a slew of GDP releases from all around the world (GDP data surprised to the upside in the US and Europe). In turn, in the short-term data on a change in oil inventories from the US may also affect the commodity price. The consensus before today’s reading suggests US inventories to have fallen by 2.5 million barrels, while gasoline inventories have fallen by 1.5 million barrels.
7:00 pm BST - FOMC minutes: In defiance to widespread expectations the Federal Reserve was not so dovish at its meeting in the beginning of May. Therefore, it is interesting what Fed members were talking about with regard to risks to the US economy. Any hints suggesting a need to loosen monetary policy could harm the greenback. Bear in mind that the buck is trading at demanding levels, hence risks surrounding today’s event could be tilted to the downside.
Central bankers’ speeches:
8:30 am BST - ECB’s Draghi
9:30 am BST - ECB’s Visco
10:30 am BST - ECB’s Praet
3:00 pm BST - Fed’s Williams
3:00 pm BST - Fed’s Bostic