Weekly Forecast – May 15
Trends in oil and commodity prices will also be an important focus after further volatility over the past week, especially with the crucial OPEC meeting due on May 25th. US political developments are liable to overshadow economic developments with further uncertainty surrounding President Trump’s next moves.
There are no very high-profile US data release for the week with second-tier data due on industrial production and housing starts as well as jobless claims.
The New York and Philadelphia Fed manufacturing surveys on Monday and Thursday respectively will be watched closely given some evidence of a slowdown in manufacturing.
Political developments will be important as the fall-out from President Trump’s firing of FBI Director Comey continues. The choice of a replacement will be important with any choice of a credible candidate helping to ease tensions to some extent. The investigation into Russian activities in the US election will also be important.
There are a series of significant UK data releases with the April inflation data on Tuesday likely to gain most attention, especially given the risk of seasonal distortions. The annual rate is likely to increase to the strongest rate for close to four years.
The labour-market data will be released on Wednesday with the retail sales announcement on Thursday and this is also likely to be distorted by seasonal factors.
Markets will monitor the UK General Election campaign and commentary on Brexit negotiations, although the impact is likely to be measured.
The final Euro-zone April inflation data will be released, although the overall impact is likely to be limited.
Markets will continue to monitor the French political developments following the inauguration of President Macron as campaigning will start for the June parliamentary elections.
Commentary from ECB officials will continue to be a very important focus as the monetary-policy debate intensifies ahead of a crucial June meeting.
The latest data on Canadian consumer inflation and retail sales will be released on Friday.
The latest Chinese industrial production data is unlikely to have a major impact.
Australian employment data will be an important factor during the week and could have important implications for interest rate expectations.
Geo-political issues will be watched closely with a further focus on North Korea.
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