Week Ahead: Markets to Focus on Major Central Banks Rate Decisions and US PPI and CPI

June 12, 2023

In the week ahead, market participants will be closely monitoring several vital economic events, including interest rate decisions by major central banks and the release of US Producer Price Index (PPI) and Consumer Price Index (CPI) data.

Market watchers and financial experts are expected to pay close attention to these releases, eager to understand their potential impact on financial markets and the global economy as a whole.

US Consumer Price Index (13 June 2023)

US CPI rose 0.4% month-over-month in April 2023, higher than the 0.1% increase seen in March.

Analysts anticipate a 0.3% rise for May data, scheduled for release on 13 June 2023.

US Producer Price Index (14 June 2023)

Producer prices for final demand in the US increased 0.2% month-over-month in April 2023, following a downwardly revised 0.4% drop in March.

For May 2023 data, set to be released on 14 June 2023, analysts expect a 0.1% increase.

US FOMC Meeting Minutes (14 June 2023)

During its May meeting, the Fed increased the Fed funds rate by 25bps, reaching a range of 5%-5.25%. This marks the 10th hike, setting borrowing costs at their highest since September 2007.

For the upcoming meeting on 14 June 2023, analysts forecast that the Fed will hold the rate steady at 5.25%.

Australia Employment Change (15 June 2023)

In April 2023, Australia’s employment saw an unanticipated drop of 4,300, bringing the total to 13.88 million. The unemployment rate increased unexpectedly to 3.7%.

Data for May 2023 is scheduled for release on 15 June 2023, and analysts predict a 20,000 rise in employment with the unemployment rate staying at 3.7%.

European Central Bank Main Refinancing Rate (15 June 2023)

During its May meeting, the ECB raised its key interest rates by 25 bps to 3.75%, signalling a slower pace of policy tightening. In a press conference, President Lagarde mentioned that the ECB still had progress to make and did not intend to halt the cycle of rate increases soon.

Analysts anticipate that for June, the central will increase its interest rates by 25 bps to 4.0%.

US Retail Sales (15 June 2023)

Retail sales in the US increased 0.4% month-on-month in April 2023, rebounding from two consecutive months of declines.

For May 2023 data, which will be released on 15 June, analysts expect a 0.5% increase.

BOJ Rate Statement (16 June 2023)

In April, the Bank of Japan unanimously voted to maintain its key short-term interest rate at -0.1% and 10-year bond yields at around 0%. They also altered guidance on their policy rate by removing references to guarding against risks from the COVID pandemic and maintaining interest rates at “current or lower levels.”

Analysts predict that for June, the rate will remain unchanged.