• Weekly briefings
• Archive

UK Data
 

• Tuesday 11.00am CBI Industrial Trends Survey for April previous 8.0
• Wednesday 9.30am Q1 GDP (flash estimate) previous 0.7% y/y
• Thursday 7.00am Nationwide House Price Survey for April previous 9.3%y/y

The highlight last week was the chain reaction after the release of the inflation data for March that came in a lot higher than expectations at 3.1%. This resulted in Mervyn King having to write a letter to Gordon Brown explaining the reasons why inflation had pushed up by over 1% above the 2% target rate. In his explanation Mervyn referred to higher food costs (especially milk!), furniture and energy costs as the main protagonists. The reaction in the market was for GBP/USD to push up through the psychological 2.00 level (not seen since Norman Lamont was chancellor in 1992) and the 12 month expectations for interest rates closed in on 6%! The highlight for this week will be the first estimate on GDP for Q1. We also have the MPC testimony to the Treasury Committee with interventions by all MPC members.

US Data

• Tuesday 3.00pm Consumer Confidence for April previous 107.2
• Tuesday 3.00pm Existing Home Sales for March previous 6.7m
• Wednesday 1.30pm Durable Goods Orders for March previous 1.7%m/m
• Wednesday 3.00pm New Home Sales for March previous 848k
• Friday 1.30pm GDP for Q1 previous 2.5%q/q ann.
• Friday 3.00pm Michigan Consumer Sentiment index for April previous 85.3

Last week it seemed that for the first time in a long time all the market’s attention was on sterling rather than the US dollar. The data coming out of the US is still mixed and if anything on the positive side, however the US dollar was sold off as the inflation data was more subdued than the market was expecting. This week the main highlight will be the release of the Q1 GDP data and on Wednesday the Fed release the Beige Book for an update on how the economy is performing overall.

Euro Data 

• Tuesday 10.00am EU Industrial New Orders for February previous -0.2%m/m
• Wednesday 9.00am German IFO (Business Sentiment) survey for April previous 107.7
• Friday 9.00am EU Retail PMI for April previous 53.4

Last week saw the release of the inflation data in the Eurozone which came in at a comfortable 1.9%. This will not deter the ECB from their gradual tightening of interest rates and the next one to 4% is expected in June. The highlight this week will be the IFO business sentiment to see how strong the business community feel this revival in the eurozone economy is. On top of this we must remain vigilant as EUR/USD pushes up to the previous highs from 2004 at 1.3667 of any comments about the strong Euro from European officialdom.

Interest rate outlook