• Tuesday: Japan
  PPI, UK Labour Market report, US NFIB Small Business Optimism Index, US
  CPI.
• Wednesday: UK GDP,
  UK Industrial Production, Eurozone Industrial Production.
• Thursday: US
  PPI, US Retail Sales, US Jobless Claims, New Zealand Manufacturing PMI.
• Friday: US
  Industrial Production, US University of Michigan Consumer Sentiment
  Survey, PBoC MLF.

Tuesday

The UK Unemployment Rate is expected to
remain unchanged at 3.8% vs. 3.8% prior.
The Average Earnings Ex-Bonus is expected to tick lower to 5.7% vs. 5.8% prior,
while the Average Earnings including Bonus is seen at 6.2% vs. 6.2% prior. Weak
figures, especially on the wage growth part, should bring expectations for rate
cuts forward, while strong data might not change much for now. The markets
expect the BoE to deliver the first rate cut in August.

The US CPI Y/Y is expected at 3.1% vs.
3.1% prior,
while the M/M measure is seen at 0.4% vs. 0.3% prior. The Core CPI Y/Y is
expected at 3.7% vs. 3.9% prior, while the M/M figure is seen at 0.3% vs. 0.4%
prior. This report comes after a series of weak US data, especially on the
labour market side, so (in my opinion) this particular release is likely to be
faded in case of a hawkish reaction to a beat. Conversely, if the data misses,
we should see the market price back in a May rate cut.

Thursday

The US PPI Y/Y is expected at 1.2% vs.
0.9% prior,
while the M/M measure is seen at 0.3% vs. 0.3% prior. The Core PPI Y/Y is
expected at 2.0% vs. 2.0% prior, while the M/M figure is seen at 0.2% vs. 0.5%
prior. As mentioned for the CPI report, the market might look through a beat in
the data considering the weaker data from the labour market and the ISM PMIs.

The US Retail Sales M/M is expected at
0.7% vs. -0.8% prior, while the Ex-Autos M/M measure is seen at 0.4% vs. -0.6%
prior. The last
report surprised to the downside across the
board, although some weakness was expected due to negative weather conditions.
Another weak report would add to dovish expectations.

The US Jobless Claims continue to be one
of the most important releases every week as it’s a timelier indicator on the
state of the labour market. Initial Claims keep on hovering around cycle lows,
while Continuing Claims remain firm around cycle highs. This week the consensus
sees Initial Claims at 218K vs. 217K prior,
while there’s no consensus for Continuing Claims at the time of writing
although the prior week saw an increase to 1906K vs. 1889K prior.

Friday

The PBoC is expected to keep the MLF rate
unchanged at 2.50%. The central bank recently delivered two bigger than
expected cuts to its RRR
rate and the 5-year LPR
rate. This weekend the Chinese
Inflation data beat expectations across the
board by a big margin with the Headline Y/Y reading jumping to 1.0% and the
Core Y/Y measure to 1.2%. The PBoC might not feel the urgency to cut rates
further at the moment.

This article was written by Giuseppe Dellamotta at www.forexlive.com.