Central bank bonanza continues as the BOE meets later today
Good day, everyone! Hope you're doing fine to after the Fed decision overnight injected much needed volatility to markets on the week. The dollar remains beaten up on the new day following a shift in the Fed's stance but the real question is how many cuts are they actually considering? That's something we'll try to decipher over the next few weeks.
Looking ahead, the BOE monetary policy meeting will be the main highlight of the European morning after the Fed overnight and the BOJ earlier today.
0600 GMT - Switzerland May trade balance data
Prior release can be found here. General indication of trade conditions in the Swiss economy. Not a major release by any means.
0800 GMT - ECB releases its economic bulletin from the June meeting
The June decision can be found here. The quote-unquote minutes here should pretty much reveal a similar message to what we've heard from the statement and Draghi's press conference at the time. Besides, Draghi's latest dovish remarks this week certainly has already given markets much more than bargained for so I reckon the release here shouldn't tell us anything new.
0830 GMT - UK May retail sales data
Prior release can be found here. With the pound having found some renewed lease of life overnight, a more positive data release here could help to give the currency much added confidence. But ultimately, it will all work back towards Brexit in the bigger picture as we move towards the second-half of the Tory leadership race.
1100 GMT - BOE announces June monetary policy decision
The May decision and inflation report can be found here. A unanimous decision to keep the bank rate on hold is expected but it'll be key to look at the language in the statement. On the one hand, the labour market is holding up and is helping to justify the BOE's reasoning for gradual rate hikes. However, with Brexit uncertainty still lingering they have no capacity or incentive to pursue that for now. The bigger risk now is will the BOE be forced to abandon its current narrative in light of softer global economic developments - which has now also forced the Fed to turn tail on their 'patient' bias. I reckon they still have room to communicate a similar message to that in May for now but it wouldn't be surprising if they took a step back today.
That's all for the session ahead. I wish you all the best of days to come and good luck with your trading!
