SHANGHAI, Jun. 13 (SMM) –Market will eye US May PPI, UK May CPI, as well as June ZEW economic climate index in Germany and the euro zone on Tuesday.
Annual rate of US PPI may fall back in May. This is mainly because US CPI annual rate fell and missed forecast in April and core personal expenditure price index slowed to 1.5% on a yearly basis in April, the slowest growth since December 2015. Inflation issue may become obstacle for US rate hike in H2.
CPI, PPI and retail price index for the UK all beat forecast and hit multi-year highs, reflecting strong growth in UK inflation level. So, the UK’s CPI for May, to be released today, should stay high as well. This will strengthen expectations for rate hike, which will boost the pound.
ZEW economic climate index and current conditions index in Germany and the euro zone, which have been rising since last July, are expected to maintain upward trend in June. Expectations remain for sustainable recovery in euro zone economy.
Crude oil prices have been falling steadily since the OPEC agreed to extend oil output cut deal. Oil prices will fall further if today’s OPEC output report points to further growth in output.
Head of the US Department of Treasury said this morning that the US Department of Treasury could obtain financing from September without raising debt upper limit, the US economy could reach 3% growth and there is large room for people to return to labor market.
See SMM price forecast, please click: SMM Price Outlook for Base Metals on SHFE (Jun. 13, 2017)