Analysts at Rabobank explained that they saw a momentous weekend in many respects, yet the week ahead could be said to be the most important of the year to date when taken in its totality.
Key Quotes:
“Today starts quietly, although we have already seen some strong key Japanese data, with core machine orders up 10.1% m-o-m vs. 2.1% expected. We then have UK trade to look to, as well as the fall-out from the G-7. The EU’s Barnier is also talking which is usually good for a move in GBP.”
“Yet Tuesday has the Trump-Kim summit, where anything from peace to nuclear war is potentially on the cards. At the same time, we have UK unemployment, the Germany ZEW survey, and a crucial US CPI report along with the small business NFIB. The UK also has a crucial parliamentary session regarding amendments to the Brexit Bill that could have a huge impact on the final shape of the UK’s exit from Europe.”
“Wednesday has the RBA Governor speaking, UK CPI and European industrial production, then US PPI, and then the FOMC meeting and a statement from Powell. Argentina also has a rate decision, and there is a key Italian debt auction too.”
“Thursday has Aussie jobs data, important Chinese numbers like retail sales and investment spending, then UK retail sales, and then the ECB meeting, where all the focus will be on any potential update from Draghi over when QE ends, even more important given recent developments in Italy. It’s also the start of the World Cup, where the ‘glamour tie’ of Russia vs. Saudi Arabia will see the House of Saud and the House of Putin have a chance to talk oil prices over the half-time oranges.”
“Friday then has the BOJ, where we will see what they are planning to do as they continue to hoover up the entire JGB market slice by slice against an improving economy but no wage or general inflation. We also get final May Eurozone CPI. Plus, Friday sees US industrial production and Michigan sentiment, and it is also the deadline for the US to announce details of the list of Chinese exports that will face a 25% tariff, potentially taking us deeper into “Solo: A Trade Wars Story”
“In short, what we’ve seen so far is likely just New World Hors d’oeuvres.”
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