The most interesting data release today is euro-zone inflation in May, which weexpect will decline back to this cycle-low of 0.5% y/y from 0.7% y/y in April. German, Italian and Spanish inflation declined in May and these figures even suggestdownside risk to our forecast. A lower inflation rate will increase the pressure on theECB but the decision to ease seems to be more or less a done deal and we still expectthe ECB to boost liquidity and introduce a negative deposit rate on Thursday, seeECB research No. 3: Expectations of easing but ECB will surprise the markets, 26May.
The euro unemployment rate is also released and we expect it to remain 11.8% inApril after it peaked at 12.0% in 2013.
The Polish central bank (NBP) will announce its monthly interest rate decision. Inline with the consensus expectation we expect the NBP to keep its key policy rateunchanged at 2.50%.
Read the full report: FX Daily
Danske Bank