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Inflation remains top of mind for investors grappling with the uncertain macro backdrop to equity markets. UK inflation figures are out this week with a big focus on whether that will force the Bank of England into a more aggressive tightening cycle. Meanwhile we get a gut check of the US consumer with retail sales and Walmart earnings due up. The week ends with the Australian elections, which could have market-moving results. 

UK inflation 

Consumer price index inflation for the UK will be the main event for many in the forex markets as they grapple with sterling’s sharp decline against the dollar in recent weeks. The Bank of England raised rates this month but a gloomy economic outlook and a suggestion that it could pause interest rate hikes this year has not helped sentiment towards the pound.  

Could a rise in inflation spark a renaissance for sterling bulls? It’s hard to see much uplift even if inflation spikes, since the BoE has indicated that soaring inflation risks recession. Fuzzy logic but one policymaker at least has been sounding quite hawkish. 

Speaking last week, policymaker Dave Ramsden said there is a risk that inflation remains elevated for a lot longer than hoped. “Certainly, on the basis of my current assessment of prospects, we’re not there yet in terms of how far monetary policy has to tighten,” he said, adding: “Given what we know about the UK labour market, I wouldn’t be surprised if it turned out to be a bit tighter … I think there are upside risks on inflation the medium term.” 

US retail sales 

Gut check for the US consumer with retail sales data for the month of April. Rising inflation and the absence of stimulus cheques has reined in consumer spending a touch. Although March data showed an uptick in spending, this was largely down to higher oil and gasoline prices. Excluding petrol station receipts, sales fell 0.3% as vehicle and e-commerce purchases, the two-largest spending categories, fell. 

MasterCard data indicates total retail sales excluding autos increased +7.2% year-over-year in April and +15.3% compared to pre-pandemic spending (2019), not adjusted for inflation. So retail sales running below the 8.3% inflation rate does not indicate fantastic growth or confidence among consumers. Meanwhile, investors will also be watching for the next quarterly earnings from Walmart.  

Australian elections 

Australia’s elections are taking place on Saturday and could have important ramifications for the market. Whilst the Australian dollar could be sensitive to any change in government spending, it’s much more sensitive to the RBA, what the Fed is doing and trade flows with China in particular. The most obvious candidates for a move are the miners and basic resources stocks. Labour has pledged to cut emissions far quicker than the centre-right Liberal National coalition government has so far committed to. Scott Morrison’s government slipped further behind the opposition Labor party in opinion polling as early voting began last week. Stay tuned for a more detailed update on the Australian elections from our expert Helen Thomas of BlondeMoney. 

Earnings Season 

16.05  17.05  18.05  19.05  20.05 


Walmart (WMT) PMO 


 Cisco Systems (CSCO) AMC 


 Applied Materials (AMAT) E 




Major economic data 

Sun May 15  11:30pm  NZD  BusinessNZ Services Index  51.6 
Mon May 16  12:01am  GBP  Rightmove HPI m/m  1.60% 
  12:50am  JPY  PPI y/y  9.50% 
  3:00am  CNH  Retail Sales y/y  -3.50% 
    CNH  Fixed Asset Investment ytd/y  9.30% 
    CNH  Industrial Production y/y  5.00% 
    CNH  NBS Press Conference   
    CNH  Unemployment Rate  5.80% 
  16th-20th  EUR  German WPI m/m  6.90% 
  7:00am  JPY  Prelim Machine Tool Orders y/y  30.00% 
  10:00am  EUR  EU Economic Forecasts   
    EUR  Trade Balance  -9.4B 
  Tentative  EUR  German Buba Monthly Report   
  1:15pm  CAD  Housing Starts  246K 
  1:30pm  CAD  Manufacturing Sales m/m  4.20% 
    CAD  Wholesale Sales m/m  -0.40% 
    USD  Empire State Manufacturing Index  24.6 
  2:30pm  GBP  CB Leading Index m/m  0.00% 
  9:00pm  USD  TIC Long-Term Purchases  141.7B 
Tue May 17  2:30am  AUD  Monetary Policy Meeting Minutes   
  5:30am  JPY  Tertiary Industry Activity m/m  -1.30% 
  7:00am  GBP  Average Earnings Index 3m/y  5.40% 
    GBP  Claimant Count Change  -46.9K 
    GBP  Unemployment Rate  3.80% 
  9:00am  EUR  Italian Trade Balance  -1.66B 
  10:00am  EUR  Flash Employment Change q/q  0.50% 
    EUR  Flash GDP q/q  0.20% 
  Tentative  GBP  30-y Bond Auction   
  1:30pm  CAD  Foreign Securities Purchases  7.44B 
    USD  Core Retail Sales m/m  1.10% 
    USD  Retail Sales m/m  0.50% 
  2:15pm  USD  Capacity Utilization Rate  78.30% 
    USD  Industrial Production m/m  0.90% 
  3:00pm  USD  Business Inventories m/m  1.50% 
    USD  NAHB Housing Market Index  77 
  Tentative  NZD  GDT Price Index  -8.50% 
Wed May 18  12:50am  JPY  Prelim GDP Price Index y/y  -1.30% 
    JPY  Prelim GDP q/q  1.10% 
  1:30am  AUD  MI Leading Index m/m  0.30% 
  2:30am  AUD  Wage Price Index q/q  0.70% 
  5:30am  JPY  Revised Industrial Production m/m  0.30% 
  7:00am  GBP  CPI y/y  7.00% 
    GBP  Core CPI y/y  5.70% 
    GBP  PPI Input m/m  5.20% 
    GBP  PPI Output m/m  2.00% 
    GBP  RPI y/y  9.00% 
  Tentative  EUR  ECB Financial Stability Review   
  9:30am  GBP  HPI y/y  10.90% 
  10:00am  EUR  Final CPI y/y  7.50% 
    EUR  Final Core CPI y/y  3.50% 
  Tentative  EUR  German 30-y Bond Auction  0.39|1.2 
  1:30pm  CAD  CPI m/m  1.40% 
    CAD  Common CPI y/y  2.80% 
    CAD  Median CPI y/y  3.80% 
    CAD  Trimmed CPI y/y  4.70% 
    CAD  Core CPI m/m  1.00% 
    USD  Building Permits  1.87M 
    USD  Housing Starts  1.79M 
  3:30pm  AUD  CB Leading Index m/m  0.60% 
    OIL  Crude Oil Inventories   
  11:45pm  NZD  PPI Input q/q  1.10% 
    NZD  PPI Output q/q  1.40% 
Thu May 19  12:50am  JPY  Core Machinery Orders m/m  -9.80% 
    JPY  Trade Balance  -0.90T 
  2:30am  AUD  Employment Change  17.9K 
    AUD  Unemployment Rate  4.00% 
  3:00am  NZD  Annual Budget Release   
  9:00am  EUR  Current Account  20.8B 
  Tentative  EUR  Spanish 10-y Bond Auction   
  12:30pm  EUR  ECB Monetary Policy Meeting Accounts   
  1:30pm  CAD  IPPI m/m  4.00% 
    CAD  NHPI m/m  1.20% 
    CAD  RMPI m/m  11.80% 
    USD  Philly Fed Manufacturing Index  17.6 
    USD  Unemployment Claims   
  3:00pm  USD  Existing Home Sales  5.77M 
    USD  CB Leading Index m/m  0.30% 
  3:30pm  NAT GAS  Natural Gas Storage   
  11:45pm  NZD  Trade Balance  -392M 
Fri May 20  12:01am  GBP  GfK Consumer Confidence  -38 
  12:30am  JPY  National Core CPI y/y  0.80% 
  4:00am  NZD  Credit Card Spending y/y  3.40% 
  7:00am  EUR  German PPI m/m  4.90% 
    GBP  Retail Sales m/m  -1.40% 
  3:00pm  EUR  Consumer Confidence  -17 
  Tentative  USD  Treasury Currency Report   
Sat May 21  All Day  AUD  Parliamentary Elections   


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