The upcoming week in the financial markets is shaping up to be significant, particularly regarding the release of inflation data and retail sales indicators, which could have a substantial impact on current market sentiment. Following recent surprises with lower-than-expected PPI data and stable employment figures in Australia, investors will closely monitor the upcoming reports that may provide additional insights into the future of the economy and central bank decisions.
The beginning of the week will bring several key publications from Canada, set to be released on Monday at 14:30 (Warsaw time). The data on CPI m/m, Trimmed CPI y/y, and Median CPI y/y will be closely watched, especially in the context of inflation concerns that may influence the Bank of Canada's monetary policy. An increase in inflation compared to previous values could suggest pressure for interest rate hikes, which in turn will affect the value of the Canadian dollar. On Tuesday, the focus will shift to New Zealand's CPI q/q data, which may also provide new insights into inflationary pressures in the region.
Wednesday will be a day when investors' attention will be drawn to data from the United Kingdom, where CPI y/y will be published at 08:00 (Warsaw time). The expected increase to 3.3% may put pressure on the Bank of England to adopt a more hawkish stance. In the context of global inflation trends, this data will be crucial for assessing further movements in the forex market. On the same day, attention will turn to the Wednesday releases from the USA, which may provide new insights into the direction in which the economy is heading.
During Thursday's session, market attention will turn to the PMI data from Germany and the United Kingdom. Markets will be particularly interested in whether these economies remain in growth territory or are starting to slow down. For Germany, the key indicators will be the German Flash Manufacturing and Services PMI, which may provide new insights into the condition of the German economy. Meanwhile, the data from the United Kingdom will be important for assessing the impact of Brexit on the local market.
Friday will conclude the week with the release of UK retail sales data m/m. Following recent weaker results, a slight increase is expected, which could signal a rebound in consumption. This week will be crucial for assessing how individual economies are coping with inflationary pressures and what further steps central banks may take. The most important day appears to be Wednesday, with the UK CPI data, which could determine market sentiment for the following days.
