• Weekly briefings
• Archive

UK Data
 

• Monday 9.30am PPI Input for March previous 1.3%m/m
• Tuesday 9.30am CPI for March previous 2.8%y/y
• Wednesday 9.30am Average Earnings for February previous 4.2% 3m avg.
• Wednesday 9.30am Bank of England release minutes to the meeting on 4-5^th April
• Friday 9.30am Retail Sales for March previous 1.4%m/m

Last week, the RICS housing survey (+25.5 3m % bal) gave confirmation of a buoyant UK housing market despite the recent rate rises from the MPC. Whilst rate hikes typically have a ‘lagged’ impact, the market is showing little signs of slowing at present thus giving scope for further tightening in the months ahead. One negative for Sterling was the release of the trade balance which widened beyond expectations to -£6.791bn as the strong pound made UK exports less attractive. This week, attention turns to PPI, CPI and average earnings data as the market looks for signs that inflationary pressures will force the MPC into action again in the coming months.

US Data

• Monday 1.30pm EmpireState Survey for April previous 1.9
• Monday 1.30pm Retail Sales for March previous 0.1%m/m
• Monday 2.00pm Treasury International Capital System (TICS) for February previous $97.4bn
• Tuesday 1.30pm Housing Starts for March previous 1.525m
• Tuesday 1.30pm CPI for March previous 0.4%m/m
• Tuesday 2.15pm US Industrial Production for March previous 1.0%m/m
• Thursday 5.00pm Philly Fed Survey for April previous 0.2

Last week saw a mixed bag of data from the US with import prices (+1.7%m/m) PPI (+1.0%m/m) and the trade balance -$58.44bn all exceeding expectations. However, these releases offered little support to the Dollar where the overall sentiment was one of Dollar weakness. The release of the FED minutes from their meeting last month continued to suggest that the committee will remain vigilant against inflation however left the flexibility to move policy in either direction in the months ahead. This week sees a plethora of data, the main highlights being retail sales on Monday for an indication on the health of the US economy and CPI on Tuesday where the market will be looking for signs that inflationary pressures will keep the FED on their toes.

Euro Data
   

• Monday 10.00am EU HICP for March previous 1.8%y/y
• Tuesday 10.00am German ZEW (Economic Sentiment) Survey for April previous 5.8
• Tuesday 10.00am EU Trade Balance for February previous -€7.8bn

The main highlight last week was the ECB interest rate decision where the committee elected to keep rates on hold at 3.75%. The accompanying statement told us nothing new and indicated that at least one further rate hike is still likely in the coming months. This helped push the Euro to new highs against the Yen and drove EUR/USD towards its December 2004 high at 1.3667. This week, the market will look towards Monday’s inflation data for confirmation that inflationary pressures will force at least one more hike from the ECB before the current cycle of monetary tightening comes to an end.

Interest rate outlook