By Dow Jones Newswires Staff
Below are the most important global events likely to affect FX and bond markets in the week starting June 23.
Preliminary purchasing managers’ surveys in the eurozone, U.K. and U.S. are among the biggest highlights in the week ahead. The surveys on manufacturing and services activity are an important indicator of economic growth. The data come amid concerns about President Trump’s tariff policy and the Israel-Iran conflict.
Noting that the global PMI data for May signaled some improvements in current and expected future output growth, S&P economists said in a note: “With tensions rising in the Middle East, pushing oil prices sharply higher, the flash PMI data will be keenly assessed to see whether April really represented ‘peak gloom’ in terms of business confidence, or whether executives consider the economic and political environment to have deteriorated further.”
In Asia, investors are bracing for a raft of inflation data that could help shape monetary policy decisions across the region. Japan’s Tokyo consumer prices, a key indicator of nationwide inflation, will be closely watched by the Bank of Japan. In Australia, the latest inflation print could firm up expectations for a July cut. Thailand’s central bank, meanwhile, is due to deliver a rate decision against a backdrop of mounting market uncertainties.
U.S.
The S&P’s flash U.S. purchasing managers’ survey for June will be closely monitored Monday.
Although not as well regarded as the ISM PMI data, the S&P figures will “attract some attention among those taking the pulse of the American economy,” Investec analysts said in a note.
The composite purchasing managers’ index rose to 53.0 in May from 50.6 in the previous month, indicating further growth. Manufacturing and services activity both expanded further.
The improvement came after the Trump administration rolled back some of its higher trade tariffs. However, uncertainty “clearly remains elevated amid the fluid tariff environment,” S&P economist Chris Williamson said in the survey’s press release.
The Conference Board’s consumer confidence survey for June will take on more importance in light of recent weak sentiment indicators moving markets given tariff worries. The latest data will be released Tuesday.
Another key focus will be data Friday on the U.S. core personal consumption expenditures price index for May. This is the Federal Reserve’s preferred measure of inflation so it could provide clues on the trajectory for interest rates.
Other data in the week ahead include existing home sales on Monday, first quarter current account figures Tuesday and new home sales Wednesday. Durable goods orders, the third estimate of U.S. first quarter gross domestic product, weekly jobless claims and pending home sales are due Thursday, followed by the final June University of Michigan consumer confidence survey Friday.
The U.S. Treasury will auction $69 billion in two-year notes on Tuesday; $70 billion in five-year notes and $28 billion in two-year floating rate notes on Wednesday as well as $44 billion in seven-year notes on Thursday.
U.K.
The U.K. flash composite, manufacturing and services PMI data for June is due to be released on Monday. The composite purchasing managers’ index rose to 50.3 in May from 48.5 in April with a move back above 50 indicating a return to growth. A reduction in manufacturing output was offset by high levels of service sector output.
“We expect June’s data to inch higher once again, penciling in a composite PMI of 50.9,” Investec analysts said in a note.
The Debt Management Office plans to sell September 2035 index-linked gilt on Tuesday and January 2040 gilt on Wednesday.
Eurozone
Forward-looking indicators will give fresh information about corporate and household sentiment, starting with flash estimate French, German and eurozone purchasing manager surveys on Monday.
Germany’s Ifo business climate index on Tuesday could have an upside surprise in store after a better-than expected print of ZEW business sentiment. The French consumer confidence survey is due on Wednesday, followed by German GfK consumer sentiment data on Thursday, as well as Italian and EU business and consumer surveys on Friday.
“We will look for signs of whether tariff uncertainty has affected sentiment negatively, which has been rather robust so far,” SEB Research said in a note.
Friday’s data avalanche will also include French consumer spending and Spanish retail sales, as well as flash estimate CPI from France and Spain on Friday.
Italy will hold its usual two end-of-month bond auctions for various types of bonds on Wednesday and Friday. Belgium will conduct an auction on Monday, while Germany will auction 4 billion euros in June 2027 Schatz on Tuesday.
Besides the auctions, the German Finance Agency is scheduled to publish the review of its third-quarter issuance plans on Tuesday, and Italy’s quarterly funding guidance is also expected on that day. Finland’s quarterly guidance is due on Friday.
Scandinavia
Sweden and Norway will hold bond auctions on Wednesday. Norway’s quarterly borrowing guidance is due on Friday.
Canada
Canada’s inflation data for May will be released on Tuesday. In April, inflation eased to an annual rate of 1.7% from 2.3% the month before. However, the Bank of Canada noted at its policy meeting earlier this month that its preferred measures of core inflation moved higher.
“Recent surveys indicate that households continue to expect that tariffs will raise prices and many businesses say they intend to pass on the costs of higher tariffs,” it said.
The BOC, which left rates unchanged at 2.75%, said it will be watching these indicators closely to gauge how inflationary pressures are evolving.
Hungary
Hungary will announce its latest policy decision on Tuesday. Last month the central bank held its key interest rate at 6.5% for the eighth consecutive meeting.
It said a “careful and patient” approach to monetary policy remains necessary due to risks to inflation as well as U.S. trade policy and geopolitical tensions. Maintaining tight monetary conditions is warranted, it said.
Czech Republic
The Czech National Bank’s interest rate decision will be released on Wednesday. The central bank lowered its key two-week repo rate by 25 basis points to 3.5% last month, as widely expected.
Persistent services price growth, solid wage dynamics, and accelerating property prices mean policymakers could be cautious about further rate cuts, ING analysts said in a note following May’s decision. However, the analysts expect another rate cut in August, citing recent soft inflation data and “persistent structural obstacles that sour the investment appetite across the whole continent.”
Russia
Russia’s central bank is due to announce its next policy decision on Wednesday. The central bank delivered a surprise 100 basis points interest-rate cut in May but appeared to signal that further rate cuts were unlikely, Commerzbank analyst Tatha Ghose said.
Following a raft of softer inflation data and rate cut signals from the central bank’s Governor Elvira Nabiullina, however, it now “seems clear that we should be anticipating the next rate cut already” next week, he said.
Mexico
In Mexico, the central bank’s interest rate decision on Thursday will take center stage. Last month Banxico cut its benchmark rate for the third consecutive meeting by 50 basis points to 8.50%. The unanimous decision in favor of another cut came amid a weak economy and concerns about trade tensions with the U.S.
Ahead of the decision, inflation data for the first half of June will be released on Tuesday. Inflation rose to an annual rate of 4.42% in May from 3.93% in April, exceeding the central bank’s target range of 3% plus or minus one percentage point.
Japan
Bank of Japan policy board member Naoki Tamura is set to speak with business leaders in Fukushima on Wednesday. Tamura, a former bank executive seen as hawkish, voted against slowing bond purchases at the BOJ’s June meeting. The central bank will also publish a summary of opinions from that meeting on the same day.
On Friday, Tokyo’s consumer price data is expected to show persistent inflation. Core consumer prices, excluding fresh food, are forecast to have risen 3.3% in June from a year earlier, down slightly from May’s 3.6% gain, according to a poll of economists by data provider Quick.
The government is also scheduled to release employment and retail sales figures for May on Friday.
China
China’s economic calendar is relatively light, with May’s industrial profit figures being the only notable release.
Industrial profits have been weak for much of the year but showed signs of improvement, supported by stronger output despite continuing trade tensions with the U.S. In April, the reading showed an increase in production despite continued uncertainty, and markets will look to see if that resilience has held up in May.
Economists at ING are monitoring whether renewed tariff pressure could push profit growth back into negative territory, snapping two months of year-on-year growth. Investors are also likely to focus on any policy announcements, particularly expectations around a new financial support tool.
Australia/New Zealand
Australian bond markets will take their cue from the May inflation data slated to be published Wednesday to gauge whether the Reserve Bank of Australia remains on target to cut interest rates next month.
A string of tame inflation prints has opened the door for the central bank to resume easing, with money markets pricing in a third rate cut this year as early as July. In its last meeting, the RBA flagged growing global risks and said it had seriously considered a 50-basis-point cut.
Still, policymakers may also be keeping an eye on oil prices at the moment, with U.S. President Trump giving Iran two weeks to halt attacks on Israel and abandon its nuclear ambitions, or face a possible U.S. strike.
Malaysia
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06-22-25 2014ET
