The latest thoughts in a note from CS
Euro Area: German & Eurozone ZEW
Consensus for the German ZEW survey expectations/current situation for September is set at 5.0/43.0, below the August print of 8.6/44.3. The Eurozone ZEW survey expectations will also be of interest, with a print of 23.7 in August.
We maintain a bearish bias on the euro, but believe further USD strength will be needed in order to push EURUSD lower from current levels.
UK: CPI
We expect CPI inflation to remain stable at 1.6% y/y in August, slightly above consensus of
1.5% y/y. According to our forecasts, RPI for August will decrease from 2.5% yoy in July to 2.4%
yoy and RPIX from 2.6% yoy in July to 2.5% y/y in August, in line with consensus. Consensus for PPI Input/Output in August is set at -0.4% mom/-0.1%mom (previous: -1.6% mom/-0.1% mom).
We expect a very binary GBP response from Thursday’s Scottish referendum; our bias is to expect a ‘no’ victory. The prospect of extended political discussion following the vote leaves us neutral on GBP from here.
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