The Bottom Line:
- Friday is the significant day for global economic data releases, including Tokyo’s core CPI inflation which likely rose to 2% year-on-year.
- Inflation readings from Germany, France, Italy, and the Euro Zone are anticipated to see a small bump, potentially influencing ECB’s rate decisions.
- The Fed’s favored inflation gauge, the core PCE deflator, is expected to show slowing monthly pace, indicating cautious consumer spending.
- The Federal Reserve will release its Beige Book survey on Wednesday, offering qualitative insights into the US economy.
- India’s Q1 GDP is projected to grow at 7%, while PMI data for China indicates moderate economic performance, yet both countries’ stocks are outperforming the S&P 500 this year.
Key Global Economic Data Releases on Friday
Key Global Economic Data Releases on Friday
Tokyo’s core CPI inflation is expected to have jumped to 2% in May from 1.6% in April, signaling continued growth for inflation, production, and employment in Japan.
In Europe, inflation readings from Germany, France, Italy, and the Euro Zone overall are anticipated to show a slight increase, influenced by technical factors rather than underlying economic shifts.
The Federal Reserve’s preferred measure of inflation, the core PCE deflator, is projected to slow down, reflecting consumers’ more selective spending habits. This may delay any potential rate cuts by the Fed as inflation progress remains sluggish.
India’s first quarter GDP is forecasted to grow at a robust 7%, supported by favorable demographics, improved infrastructure, and political stability, while China’s PMI data may indicate a more moderate economic performance.
Inflation Trends in Europe and Their Impact on ECB Rates
European Inflation Trends and ECB Rate Impact
In Europe, inflation readings from Germany, France, Italy, and the Euro Zone overall are anticipated to show a slight increase, influenced by technical factors rather than underlying economic shifts.
The Federal Reserve’s preferred measure of inflation, the core PCE deflator, is projected to slow down, reflecting consumers’ more selective spending habits. This may delay any potential rate cuts by the Fed as inflation progress remains sluggish.
US Core PCE Deflator: What It Signals About Consumer Spending
Insight into US Core PCE Deflator and Consumer Behavior
The forthcoming release of the US core PCE deflator is expected to show a deceleration in inflation, signaling a slower pace of monthly growth. This trend indicates that consumers are becoming more discerning in their spending habits. As seen in recent retail sales data, personal spending growth is likely to slow down to 0.4% for the month. The sluggish progress in inflation means that the Federal Reserve may take longer to gain the necessary confidence to implement rate cuts.
Insights from the Federal Reserve’s Beige Book
Insights from the Federal Reserve’s Beige Book
On Wednesday, the Federal Reserve will release its Beige Book economic survey compiled from insights gathered from its 12 District Banks. This report aims to provide a qualitative assessment of economic trends within the United States, offering valuable information on various sectors and regions. The Beige Book is a key resource for policymakers, analysts, and investors alike as they seek to understand the current state of the US economy and identify emerging patterns that may impact future decisions and strategies.
Economic Growth Projections for India and China
Economic Growth Projections for India and China
India’s first quarter GDP is forecasted to grow at a robust 7%, supported by favorable demographics, improved infrastructure, and political stability. On the other hand, China’s PMI data may suggest a more moderate economic performance this quarter.
