Central Banks, Inflation, and Interest Rates.

After an extended weekend to Celebrate the life of Her Majesty Queen Elizabeth II in the UK, we come back to an important raft of Central Bank data.

The Federal Reserve Open Market Committee are expected to hike interest rates by either 0.75% or 1% in their meeting tomorrow. This more hawkish approach has been driven by higher than anticipated inflation data last week.

The Bank of England are also expected to hike interest rates by 0.5%, UK inflation printed less than the market expected last week, this is unlikely to but may cool the Monetary Policy Committee’s path of interest rate hikes.

In Germany the Producer Price Index came in significantly higher than expected at 7.9%, the strongest rate since records began, rather than the forecast 1.5%. The Producer Price Index measures the cost of raw materials companies require to manufacture goods. With the cost of wholesale energy soaring the two combined will further add the continents issues with inflation. It is therefore expected that the ECB will be forced to further hike interest rates.

The Ukrainian army, continue to retake ground in the East of the country. On her first foreign trip Liz will pledge at a UN summit to meet or exceed the 2.3 billion pounds ($2.6 billion) of military aid spent on Ukraine in 2022 in the next year.

Economic Calendar

Expected Previous
07:00 CHF Trade Balance 3.52B
07:00 EUR German PPI m/m 2.5% 5.3%
09:00 EUR Current Account 5.3B 4.2B
13:30 CAD CPI m/m -0.1% 0.1%
13:30 Common CPI y/y 5.6% 5.5%
13:30 Median CPI y/y 5.1% 5.0%
13:30 Trimmed CPI y/y 5.5% 5.4%
13:30 Core CPI m/m 0.5%
13:30 USD Building Permits 1.60M 1.69M
13:30 USD Housing Starts 1.45M 1.45M
Tentative NZD GDT Price Index 4.9%
18:00 EUR ECB President Lagarde Speaks
20:30 CAD Gov Council Member Beaudry Speaks

*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time. CentralFX are not responsible for the rates shown.