SHANGHAI, Jul. 18 (SMM) – UK’s annualized June CPI and retail sales, ZEW economic climate index in eurozone for July and US imported goods price index will be released today. The US dollar slumped overnight. Market confidence has not improved. The US dollar should remain weak unless there is positive news. Base metals were strong during Asian trading hours, but fell later the day.
Consumers are faced with political uncertainty after UK’s general election, and increasing inflation pressure. UK’s June CPI is expected to hold flat at 2.9%, higher than the Bank of England’s (BOE) 2% target. UK’s June retail sales are expected to fall 0.1% but stay high. This may fuel market expectations of deflation in the UK, and boost the pound.
ZEW economic climate index rose for 4 months in a row. This, combined with positive trade data in the eurozone, bodes well for ZEW economic climate index. ZEW July economic climate index for Germany in July is not promising. But Germany’s economic growth is still optimistic in the following six months.
UK imported goods index may fall 0.2% in June, compared to a 0.3% drop in May. Imported goods price index is expected to be 1.3 in June, down further from 2.1 in May, presaging weakening inflation in the US.