The biggest economic indicators of the week

It’s a big week for both the pound and the greenback starting off with an inflation report from the UK followed by the BOE’s interest rate decision later in the week. The USD should see some action around the long awaited FOMC interest rate decision. We could be in for some major central bank divergence as the Bank of England balances an uncertain election result and the Fed looks to move in the opposite direction with raising rates.

Event: UK Consumer Price Index (May)

Date: Tuesday 13 June 2017 at 08:30 GMT

Markets affected: GBP/USD, EUR/GBP

Trending hashtags: #gbp, #cpi

Consumer Price Index the previous month showed inflation in the UK had increased to 2.7%, far above the BOE’s target of 2%. This is the fastest growth it has seen in three and half years. On a month on month basis it grew 0.5%, and compared to last year it increased 2.7% – marginally due to a later Easter holiday. Core CPI which doesn’t take into account more volatile prices like energy and food also rose 2.4% on a year on year basis, an 1.8% rise against the previous month as retailers increased prices to offset a drop in the pound. May’s CPI reading is expected to increase to 2.75% on an annualised basis.

Event: US Retail Sales (May)

Date: Wednesday 14 June 2017 at 12:30 GMT

Markets affected: EUR/USD, GBP/USD

Trending hashtags: #usd, #retail

Retail sales is a closely followed indicator by the Fed so the result around noon on Wednesday may have some impact on the interest rate announcement later in the day. For April Retail Sales increased 0.4% on a monthly basis and the forecast for May is a drop to 0.2% change. Any changes might see some volatility for the USD though many might hold onto their positions waiting for the Fed decision later on.

Event: US CPI (May)

Date: Wednesday 14 June 2017 at 12:30 GMT

Markets affected: EUR/USD, GBP/USD

Trending hashtags: #usd, #cpi