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The Federal Reserve\u2019s favored inflation yardsticks are poised to show the tamest monthly advances since late last year \u2014 a stepping stone for officials to begin lowering interest rates, possibly as soon as September.<\/p>\n
Economists expect no change in the May personal consumption expenditures price index and a minimal 0.1% gain in the core measure that excludes food and energy, based on median projections in a Bloomberg survey of economists.\u00a0<\/p>\n
The report, due Friday, is also projected to show 2.6% annual advances in both the overall and core gauges. The expected increase in the core measure, which paints a better picture of underlying inflation, would remain the smallest since March 2021.<\/p>\n
Since their last meeting, Fed officials have said that while they\u2019re encouraged by the simmering down in other inflation data \u2014 including the consumer price index \u2014 they need to see months of such progress before lowering rates.<\/p>\n
At the same time, the labor market \u2013 the other part of the Fed\u2019s dual mandate \u2013 is still plugging along, albeit in a lower gear. A healthy job market is providing policymakers some flexibility on the timing of interest-rate cuts.<\/p>\n
The latest inflation numbers will be accompanied by personal spending figures that will inform on services outlays after recent retail sales data showed less of an appetite for merchandise. The median forecast calls for a slight acceleration in nominal personal consumption as well as income.\u00a0<\/p>\n
What Bloomberg Economics says: \u201cWe don\u2019t think the slower inflation print will be enough to convince officials by the time of the July FOMC meeting that inflation is on a firm trajectory down to the Fed\u2019s 2% target.\u201d \u2014Estelle Ou, Stuart Paul and Eliza Winger, economists.<\/p>\n
Among other data in the coming week are readings on June consumer confidence and reports on May contract signings for purchases of both new and previously-owned homes. In addition to the third estimate of first-quarter economic growth, the government will release figures on durable goods orders for May.<\/p>\n
In Canada, central bank Governor Tiff Macklem is set to speak in Winnipeg, consumer price data for May are expected to show core inflation easing for a fifth month, and a gross domestic product release for April along with a flash estimate for May will also provide crucial insight.<\/p>\n
Elsewhere, inflation numbers in three major euro-zone economies may also cheer officials, while central banks in Sweden and Mexico will probably keep rates on hold.<\/p>\n
Click here<\/a>\u00a0for what happened in the past week and below is our wrap of what\u2019s coming up in the global economy.<\/p>\n Asia gets under way with the release of minutes from this month\u2019s Bank of Japan policy board meeting.\u00a0<\/p>\n The document takes on heightened interest after authorities pledged to cut bond buying, while also saying that investors will have to wait until late July before getting details about the scale of the reductions. Hints may emerge on Monday.\u00a0<\/p>\n Elsewhere, Reserve Bank of Australia Assistant Governor Christopher Kent speaks on Wednesday and Deputy Governor Andrew Hauser a day later, with the focus falling on any fresh hints of hawkishness after the governor said the board considered a hike at its meeting this month.\u00a0<\/p>\n They speak after data Wednesday are expected to show Australian inflation ticked higher in May.\u00a0<\/p>\n Japan will see a leading indicator for national inflation trends with the release of the Tokyo CPI gauge for June. Bloomberg Economics expects inflation in the capital to have picked up to 2.1%, lifted by an increase in utility prices after the government cut energy subsidies.\u00a0<\/p>\n Other nations publishing updates on prices include Malaysia, Singapore and Uzbekistan.\u00a0<\/p>\n In other data, China\u2019s industrial profits on Thursday may reflect the benefits of an official push for equipment upgrades, and trade statistics are due during the week in New Zealand, Vietnam, Sri Lanka, Thailand and Hong Kong.\u00a0<\/p>\n South Korea gets two indicators pointing to domestic demand with retail sales and consumer confidence.\u00a0<\/p>\n Meanwhile, China and the European Union agreed to\u00a0start talks<\/a>\u00a0on the bloc\u2019s plans to impose tariffs on electric vehicles imported from the Asian nation.\u00a0<\/p>\n The Riksbank decision on Thursday will be a highlight, with Swedish officials widely expected by economists to pause their easing cycle after an initial rate cut last month \u2014 presaging a similar move anticipated for the European Central Bank to stay on hold in July.<\/p>\n With policymakers becoming more confident that Sweden is closer to taming inflation, they may ratify a path of two more reductions this year to bolster an economy that\u2019s forecast by EU officials to post one of the weakest expansions in the whole bloc.<\/p>\n Here\u2019s a quick look at other central bank decisions around the wider region:<\/p>\n In the euro zone, inflation data in three of its four biggest economies will arrive toward the end of the week. The reports are expected to show slowing in France and Spain, with price growth staying weak in Italy.\u00a0<\/p>\n Those numbers may offer encouragement to officials after last month\u2019s setback, when inflation accelerated more than anticipated across the region. The ECB\u2019s survey of consumer price expectations will also be released on Friday.\u00a0<\/p>\n Other reports include Germany\u2019s Ifo business confidence index on Monday, which is anticipated to show further gradual improvement in sentiment among companies in the region\u2019s biggest economy.<\/p>\n Policymakers scheduled to speak include Bank of France Governor Francois Villeroy de Galhau, whose economy is subject to intense investor scrutiny before\u00a0upcoming legislative elections<\/a>. Appearances by ECB Chief Economist Philip Lane and the German and Italian central bank heads are also on the calendar.\u00a0<\/p>\n In the UK, meanwhile, Bank of England officials \u2014 whose June 20 decision moved closer toward a\u00a0potential rate cut in August<\/a>\u00a0\u2014 will continue to avoid public communications ahead of the July 4 general election. Data there include the final GDP release for the first quarter on Friday, including current account numbers.<\/p>\n Turning to Africa, Zambia\u2019s growth statistics for the first three months of 2024, due on Thursday, may reveal some of the impact from a devastating drought. The dry spell is expected to cut expansion to 2.5% this year from 5.2% in 2023.\u00a0<\/p>\nAsia<\/h3>\n
Europe, Middle East, Africa<\/h3>\n
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