It is set to be a quieter week for investors following last week’s heavy run of central bank decisions and major economic data.
However, the tentative ceasefire agreement between the US and Iran may already be under strain, if weekend reports are to be believed. On Saturday, Iran claimed it was closing the Strait of Hormuz in response to Israeli strikes on Lebanon.
The White House said Vice President JD Vance departed for Switzerland on Saturday ahead of technical-level talks aimed at securing an interim ceasefire agreement. The discussions are intended to halt hostilities permanently, reopen the Strait of Hormuz and pave the way for nuclear negotiations.
In the UK, speculation continues to swirl around Prime Minister Keir Starmer’s future, with some reports suggesting he could announce his departure as early as Monday.
On the central bank front, the Bank of Japan’s Summary of Opinions is due this week, while the ECB will publish its latest Economic Bulletin a day later.
All Times Are GMT
Monday 22 June
02:00 – China PBoC Interest Rate Decision Consensus: 1-Yr Rate On Hold (prev 3.00%)
Barclays said, “We expect China to keep the 1y LPR unchanged in view of the uptick in PPI inflation and flush banking system liquidity.”
TD Securities said, “We look for CPI to firm 0.3pp (0.8% m/m) on higher energy prices and seasonal tailwinds alongside a modest acceleration in core goods. CPI-trim/median should stabilise at 2.0/2.1% as 3M core inflation rises to 2.4%. That leaves core CPI tracking near BoC projections, as the recent thaw in oil gives the Bank more scope to look through a mild broadening of price pressures.”
Economists note that PMIs will be the key release in an otherwise survey-heavy week, with policymakers closely watching for signs of how the Iran conflict is affecting growth and inflation. Nomura said, “The PMI surveys are typically conducted during a period of just over a week in the middle of the month, so the June surveys should incorporate part of the period in which purchasing managers would have known about the Iran deal. While the PMIs are surveys that primarily ask participants about activity rather than sentiment, we would not be surprised should the better news out of the Middle East see an improvement in some of the activity indices of this survey. Still, on the manufacturing side, it may be there is less bringing forward of demand to insulate against supply-side risks, which could cap activity growth in the sector.”
Commonwealth Bank of Australia economists expect annual headline inflation to ease slightly to 4.1% in May as lower fuel prices weigh on the monthly reading, though underlying inflation is likely to remain firm. “The monthly measure of trimmed mean inflation is expected to edge higher to 3.5% on an annual basis, while market services inflation is estimated at 3.7%. There continues to be considerable uncertainty about the extent to which businesses pass higher costs on to consumers. While we expect some increase in pass-through during May, the available data suggest that the more severe inflation scenarios considered in the immediate aftermath of the Middle East conflict have so far not materialised,” analysts said.
09:00 – Germany IFO Business Climate Index (Jun) Consensus: M/M 85.5 (prev 84.9)
SocGen said it expects the German IFO confidence index to improve more noticeably in June after stabilising in May, following sharper falls in March and April. “Expectations should recover more strongly but remain at subdued levels,” analysts said. “The current assessment of business conditions should also improve and may be a more reliable indicator of economic activity, which is likely to have remained weak in Q2 and Q3. The ongoing fiscal expansion, a recovery in construction activity and rising AI-related investment should help limit fears of a prolonged recession.”
01:30 – Australia Labour Force Survey Consensus: Empl. Chg. 30.0k (prev -18.6k)
Westpac’s economists said recent weakness in employment may reflect “abnormal seasonality”, noting that April’s labour force survey ran through the full Easter weekend and may have captured temporary softness not fully adjusted for. “We expect a bounce-back of +45k in May. This would amount to an average monthly gain of around 13k/mth over April and May, a clear step down from the 30k/mth pace over Q1.”
12:30 – US Core PCE (May) Consensus: 3.4% (prev 3.4%)
Citi said it expects core PCE to increase by a strong 0.37% m/m in May, outpacing core CPI, with the gap driven mainly by strength in portfolio management fees, which move with equity prices. The bank said core goods inflation was likely to be soft in PCE this month, as AI-related components were weaker. "We expect upcoming monthly core PCE readings to show further easing in inflation, but with core PCE expected to significantly outpace core CPI this year."
Speakers: BoJ’s Tamura | BoE’s Breeden, Dhingra | ECB’s Moulin, Lane | Fed’s Williams
It is set to be a quieter week for investors following last week’s heavy run of central bank decisions and major economic data.
However, the tentative ceasefire agreement between the US and Iran may already be under strain, if weekend reports are to be believed. On Saturday, Iran claimed it was closing the Strait of Hormuz in response to Israeli strikes on Lebanon.
The White House said Vice President JD Vance departed for Switzerland on Saturday ahead of technical-level talks aimed at securing an interim ceasefire agreement. The discussions are intended to halt hostilities permanently, reopen the Strait of Hormuz and pave the way for nuclear negotiations.
In the UK, speculation continues to swirl around Prime Minister Keir Starmer’s future, with some reports suggesting he could announce his departure as early as Monday.
On the central bank front, the Bank of Japan’s Summary of Opinions is due this week, while the ECB will publish its latest Economic Bulletin a day later.
All Times Are GMT
02:00 – China PBoC Interest Rate Decision
Consensus: 1-Yr Rate On Hold (prev 3.00%)
Barclays said, “We expect China to keep the 1y LPR unchanged in view of the uptick in PPI inflation and flush banking system liquidity.”
12:30 – Canada CPI (May)
Consensus: Y/Y 3.0% (prev 2.8%)
TD Securities said, “We look for CPI to firm 0.3pp (0.8% m/m) on higher energy prices and seasonal tailwinds alongside a modest acceleration in core goods. CPI-trim/median should stabilise at 2.0/2.1% as 3M core inflation rises to 2.4%. That leaves core CPI tracking near BoC projections, as the recent thaw in oil gives the Bank more scope to look through a mild broadening of price pressures.”
Speakers: ECB’s Lagarde, Kocher | Fed’s Waller
09:00 – Eurozone PMI Composite (Jun P)
Consensus: M/M 49.1 (prev 49.0)
Economists note that PMIs will be the key release in an otherwise survey-heavy week, with policymakers closely watching for signs of how the Iran conflict is affecting growth and inflation. Nomura said, “The PMI surveys are typically conducted during a period of just over a week in the middle of the month, so the June surveys should incorporate part of the period in which purchasing managers would have known about the Iran deal. While the PMIs are surveys that primarily ask participants about activity rather than sentiment, we would not be surprised should the better news out of the Middle East see an improvement in some of the activity indices of this survey. Still, on the manufacturing side, it may be there is less bringing forward of demand to insulate against supply-side risks, which could cap activity growth in the sector.”
Speakers: BoE’s Taylor, Dhingra | ECB’s Lane, Vujcic
01:30 – Australia CPI/Trimmed CPI (May)
Consensus: Y/Y 4.1% (prev 4.2%)
Commonwealth Bank of Australia economists expect annual headline inflation to ease slightly to 4.1% in May as lower fuel prices weigh on the monthly reading, though underlying inflation is likely to remain firm. “The monthly measure of trimmed mean inflation is expected to edge higher to 3.5% on an annual basis, while market services inflation is estimated at 3.7%. There continues to be considerable uncertainty about the extent to which businesses pass higher costs on to consumers. While we expect some increase in pass-through during May, the available data suggest that the more severe inflation scenarios considered in the immediate aftermath of the Middle East conflict have so far not materialised,” analysts said.
09:00 – Germany IFO Business Climate Index (Jun)
Consensus: M/M 85.5 (prev 84.9)
SocGen said it expects the German IFO confidence index to improve more noticeably in June after stabilising in May, following sharper falls in March and April. “Expectations should recover more strongly but remain at subdued levels,” analysts said. “The current assessment of business conditions should also improve and may be a more reliable indicator of economic activity, which is likely to have remained weak in Q2 and Q3. The ongoing fiscal expansion, a recovery in construction activity and rising AI-related investment should help limit fears of a prolonged recession.”
Speakers: BoJ’s Ueda (Himino) | RBA’s Hauser | BoE’s Breeden | ECB’s Nagel | Fed’s Goolsbee, Williams
01:30 – Australia Labour Force Survey
Consensus: Empl. Chg. 30.0k (prev -18.6k)
Westpac’s economists said recent weakness in employment may reflect “abnormal seasonality”, noting that April’s labour force survey ran through the full Easter weekend and may have captured temporary softness not fully adjusted for. “We expect a bounce-back of +45k in May. This would amount to an average monthly gain of around 13k/mth over April and May, a clear step down from the 30k/mth pace over Q1.”
12:30 – US Core PCE (May)
Consensus: 3.4% (prev 3.4%)
Citi said it expects core PCE to increase by a strong 0.37% m/m in May, outpacing core CPI, with the gap driven mainly by strength in portfolio management fees, which move with equity prices. The bank said core goods inflation was likely to be soft in PCE this month, as AI-related components were weaker. "We expect upcoming monthly core PCE readings to show further easing in inflation, but with core PCE expected to significantly outpace core CPI this year."
Speakers: BoJ’s Tamura | BoE’s Breeden, Dhingra | ECB’s Moulin, Lane | Fed’s Williams
Speakers: Fed’s Kashkari | ECB’s Nagel, Schnabel, Vujcic