Tom Westbrook talks about future prospects for the European and global markets
Traders could take a distraction from England’s cricket defeat if this morning’s UK inflation data show the slowdown economists are expecting.
Headline CPI inflation is expected to fall to 0.5% in May from 1.2% in May, and the pace of core inflation is expected to slow, according to a Reuters poll.
This could bolster market views that the Bank of England is more likely to raise rates by 25 basis points than by 50 basis points at its meeting on Thursday. Pre-CPI pricing implies a 75% chance of the former and a 25% chance of the latter.
But a bit different than Australia’s comeback at Edgbaston calling into question England’s aggressive new style of cricket, an unexpected inflation upside could shake the policy outlook.
Government bond yields paused recent declines on Tuesday as traders waited for data and policymakers’ reactions, but the pound is often tempted to break a one-year high as the economic outlook is poor. seems to be
In Asia, the slowdown in China and the lack of big bang stimulus have depressed markets. Hong Kong’s Hang Seng (.HSI) fell about 2%, again targeting 2023 lows, while the yuan is cheaper than it was in December when China’s borders were still closed.
U.S. President Joe Biden called the Chinese president a dictator in his remarks at a California fundraiser late Tuesday, but perhaps this isn’t much progress after top diplomat Anthony Brinken’s visit to China. may be suggesting that
Federal Reserve Chairman Jerome Powell is set to appear before Congress late Wednesday to be asked about policymakers’ outlook for two more rate hikes this year.
Key developments that may affect the market on Wednesday:
UK inflation data
Fed Chairman Jerome Powell Speaks
Reported by Tom Westbrook.Editing: Jacqueline Wong
Our criteria: Thomson Reuters Trust Principles.
