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18 May 2015
Central Bank's minutes, inflation key headline events
FXStreet (Bali) - David Fritz, FX Strategist at Nomura, breaks down the key events for the week ahead, emphasizing minutes from the Fed, BoE, ECB and RBA, together with Japan Monetary policy statement, CPI from UK, Eurozone, US and Canada, and lastly, Eurozone PMI.
Key Quotes
"In the US, the headlines will likely focus around the minutes from the April FOMC meeting, released on Wednesday. The statement had been in line with our economists’ expectations, and the FOMC seemed confident about the economic growth trajectory. The minutes will be interesting in gaining a sense of the underlying confidence in the growth and to see if there were any concerns about the poor employment report from March. In terms of data, the key point may well be the US inflation report for April. Our US economics team believes there will be a balance struck between lower import prices due to a stronger dollar and inflationary pressures from a tightening labor market and housing demand."
"In the UK, we will also get the minutes, as well as the CPI. Also on the docket in the UK will be the retail sales figures for April. Our UK economics team does not expect much new from the BoE minutes, however, as most of the BoE post-election views have been communicated through the inflation report and thus it generally does not expect much of a change in the central tone of the minutes. For the inflation report, Nomura expects 0.1% y-o-y, just above the market consensus of 0.0%. However, risks are noted to be on the downside. Retail sales figures are expected to show slowing overall growth for April compared with the month prior as it will not gain from the payback that March had seen. For more details, see UK Wrap, 14 May 2015."
"In the rest of Europe, the main data will be the preliminary May PMIs for France, Germany, and the Eurozone on Thursday, as well as the German IFO figures on Friday. The latest tracking estimates for the Euro area suggest that the economy will be in expansion, growing at 0.4% q-o-q. The risks, however, are noted by our economists to be on the downside. This additional hard evidence could firm up the estimate or lower it, as Nomura estimates for Eurozone PMIs and German IFO are both below the prior month’s figures and consensus estimates."
"For the BoJ meeting on Thursday/Friday, our economists expect the BOJ to leave monetary policy unchanged. However, there will be an estimate of Q1 GDP growth in Japan on Tuesday/Wednesday, which could cause the BOJ to tweak its optimistic economic stance and raise questions on inflationary expectations. The GDP estimate is expected to show a decline of 0.3% q-o-q annualized, and our estimates are sharply below consensus of 1.6%."
Key Quotes
"In the US, the headlines will likely focus around the minutes from the April FOMC meeting, released on Wednesday. The statement had been in line with our economists’ expectations, and the FOMC seemed confident about the economic growth trajectory. The minutes will be interesting in gaining a sense of the underlying confidence in the growth and to see if there were any concerns about the poor employment report from March. In terms of data, the key point may well be the US inflation report for April. Our US economics team believes there will be a balance struck between lower import prices due to a stronger dollar and inflationary pressures from a tightening labor market and housing demand."
"In the UK, we will also get the minutes, as well as the CPI. Also on the docket in the UK will be the retail sales figures for April. Our UK economics team does not expect much new from the BoE minutes, however, as most of the BoE post-election views have been communicated through the inflation report and thus it generally does not expect much of a change in the central tone of the minutes. For the inflation report, Nomura expects 0.1% y-o-y, just above the market consensus of 0.0%. However, risks are noted to be on the downside. Retail sales figures are expected to show slowing overall growth for April compared with the month prior as it will not gain from the payback that March had seen. For more details, see UK Wrap, 14 May 2015."
"In the rest of Europe, the main data will be the preliminary May PMIs for France, Germany, and the Eurozone on Thursday, as well as the German IFO figures on Friday. The latest tracking estimates for the Euro area suggest that the economy will be in expansion, growing at 0.4% q-o-q. The risks, however, are noted by our economists to be on the downside. This additional hard evidence could firm up the estimate or lower it, as Nomura estimates for Eurozone PMIs and German IFO are both below the prior month’s figures and consensus estimates."
"For the BoJ meeting on Thursday/Friday, our economists expect the BOJ to leave monetary policy unchanged. However, there will be an estimate of Q1 GDP growth in Japan on Tuesday/Wednesday, which could cause the BOJ to tweak its optimistic economic stance and raise questions on inflationary expectations. The GDP estimate is expected to show a decline of 0.3% q-o-q annualized, and our estimates are sharply below consensus of 1.6%."