Tuesday 20th May 2008
A quiet start to a busy week
Yesterday was a relatively quiet start to the week, especially when you consider the importance of the Bank of England minutes and FOMC minutes due out tomorrow. Monday saw the major currencies trade within previous ranges, with Sterling making some initial ground against the US Dollar and over the 1.9600 level, before being traded back under 1.9500 with better than expected data released mid-afternoon across the Atlantic. Elsewhere, equity markets saw some now standard volatility as investor focus on rights issues caused concern amongst some financial stocks.
Today we have the US PPI figure for April due at 13.30BST; this is expected to have risen last month reflecting higher energy costs. Expectations have been at a 0.4 percent gain however over the past week 0.5 percent has looked more realistic, following the 1.1 percent increase in March. Core prices, including food and energy are likely to have climbed 0.2 percent, the same as a month earlier. The slowing prices have prevented companies from raising prices enough to cover the jump in raw-material costs, hurting profits.
The ZEW Centre for European Economic Research is expected to say in its index of investor and analyst expectations rose to minus 37 in May from minus 40.7 in April. German economic growth accelerated to the fastest pace in 12 years in the first quarter and the benchmark DAX share index has gained 6 percent in the past month.
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