Alessandro #IoMiVaccino 🇮🇹🇪🇺🇺🇸🇮🇱 · @pelias01
31st Jul 2015 from TwitLonger
Daily economic outlook: 31st July, 2015
Inflation indicators in the euro area and the US will likely receive the most attention today in terms of economic data releases. Eurostat's flash CPI estimate for the euro area is expected to show no change in the annual headline rate at 0.2%, with perhaps a small downside risk. Yesterday's releases showed no change in German headline inflation on the EU-harmonised measure at 0.1%, while the Spanish number fell unexpectedly to -0.1%.
Policymakers will focus particularly on the euro area core CPI measure, which excludes food and energy, as a guide to underlying price pressures. There has been some tentative evidence of a recovery in core CPI, led mainly by non-energy industrial goods, reflecting the impact of the lower euro on import prices. Nevertheless, annual core inflation remains low and it seems to be staying unchanged at 0.8% in July, says Lloyds Bank.
In the US, the Employment Cost Index (ECI) showed a notable pickup in Q1 to 2.6%y/y, which appeared somewhat at odds with the more subdued growth in monthly average earnings. In the context of the timing of the first Fed rate hike, the ECI will be closely monitored. Lloyds Bank notes, a 0.7%q/q rise which would result in a slight easing in the annual rate to 2.5%, but the trend over the past year remains positive.
Elsewhere, the Lloyds Business Barometer survey for July could provide a heads-up for next week's services PMI release. Euro area consumption indicators in the form of German retail sales and French consumer spending, both for June, will also be released.
Source: FxWire Pro - Commentary