Germany’s IFO business climate will shed some light on the mood in Europe’s biggest economy on Monday, followed by consumer confidence in the US on Tuesday and the University of Michigan Sentiment Index on Friday.
CIO will monitor CPI and core CPI releases in the Eurozone and what they mean for the future policy of the European Central Bank (ECB) after it lowered its inflation forecasts for the coming years. In September, CIO expects the ECB to announce its intention to begin tapering its quantitative easing program, beginning in January 2018. The expected QE exit should lead to a higher euro.
In emerging markets, data releases are light over the coming week. The Bank Board of the Czech National Bank will convene on Thursday but is unlikely to take any action, CIO said. Recent koruna strength has delivered some monetary tightening, and the time for the first rate hike in a long time should not have come yet. Still, growth-inflation dynamics remain sound, and CIO retains its preference for the koruna over the euro. Elsewhere, China’s official manufacturing PMI will be published at the end of the week.