Focus this week will be on the FOMC meeting on Wednesday. The markets will belooking for signals as to the timing of the first rate hike, as a further decline inunemployment and a rise in inflation recently has put the issue on the agenda.
Today focus will be on final euro inflation data and a string of US manufacturing andhousing data.
In the euro area inflation for May is expected to be confirmed at 0.5% y/y. Coreinflation should also be unchanged at 0.7%.
The US empire index is expected to fall back slightly to 15 in June after reaching atwo-year high in May at 19. US industrial production should rebound in Mayfollowing a soft April reading. It is forecast to rise 0.5% m/m, up from -0.6% inApril.
Finally the US NAHB housing market index is expected to rise slightly to 47 from45. The index declined in the beginning of the year but has flattened out in the pastcouple of months. We believe housing is about to recover gradually again as the effectof last year’s mortgage rate rise is expected to reverse as mortgage rates have comedown again.
Read the full report: FX Daily