Tomorrow's Macro Roadmap: One Inflation Print, No Central Bankers, and a New Prime Minister
Macro: The Big Picture
Monday opens the new week with the Fed and the ECB both silent, and one inflation print carrying the session: Canada's June CPI at 14:30 CET, the first of three big consumer price reports this week, alongside New Zealand overnight into Tuesday and Japan on Friday. The Federal Reserve's external-communications blackout began on Saturday and runs through 30 July ahead of the 28-29 July FOMC meeting, while the ECB is within its pre-decision quiet period before Thursday's Governing Council decision, so no central-bank speakers are scheduled anywhere in the G10. The overnight session is thinner than usual: Japanese markets are closed for the Marine Day holiday, removing the cash JGB and Tokyo equity sessions from a market still digesting last week's AI-led selloff, in which the Philadelphia semiconductor index and the KOSPI both entered bear-market territory. China's monthly loan prime rate fixing lands at 03:15 CET, the day's only scheduled policy decision (full preview in the Central Banks section below), and New Zealand's June trade figures at 00:45 CET open the data run. In Europe, Andy Burnham is sworn in as UK Prime Minister, with his cabinet appointments, above all the Chancellor, the session's main political watch-point for gilts and sterling. The Farnborough International Airshow also opens, running to 24 July. The rest of the slate is second-tier: German producer prices at 08:00 CET, euro-area construction output at 11:00 CET, the SNB's weekly sight-deposit data at 10:00 CET, India's June infrastructure output at 13:30 CET, and the Conference Board's US leading index at 16:00 CET. Routine funding operations round out the day: a Korean 5-year KTB auction, three French BTF auctions at 15:00 CET, US 3- and 6-month bill auctions at 17:30 CET and a NY Fed bill purchase operation at 15:20 CET.
Data Release Previews
Canada: The week's first big inflation test: gasoline should drag the headline back towards 3%, but one forecaster sees it stuck at 3.2%
Canada's June consumer price index lands at 14:30 CET, marking its first publication in StatCan's new Monday-morning slot. The headline rate stood at 3.2% in May, with the monthly index up 1.0%. Consensus looks for prices to fall 0.2% on the month in June. The story is gasoline. Pump prices fell close to 10% between May and June as the mid-June pause in the US-Iran conflict knocked crude lower, and that single component accounts for the bulk of the expected headline decline, according to most analysts. The Bank of Canada's preferred core measures print at 2.0% for the trimmed mean, 2.1% for the median, and 2.7% for the common component, with the core rate at 2.2%. Consensus expects the trimmed mean to hold at 2.0% and the median at 2.1%, unchanged from May. Beneath the consensus, there is a genuine split. Several analysts see the monthly decline reaching 0.3%, and one house flags outright downside-surprise risk from fading input costs and output prices in the surveys. A contrarian minority argues the opposite: June is a seasonal up-month for unadjusted prices, shelter could return as a driver, and the print could come in flat on the month with the annual rate unchanged at 3.2%. One further wrinkle: some analysts expect the exclusionary core measures to firm rather than soften in June, on lagged airfare pass-through from earlier fuel-cost increases and a temporary FIFA World Cup lift to hotels and spectator sports, even as the trimmed and median measures hold near 2%.
Here is a breakdown of the estimated contribution of each major basket component to the May headline rate: Transportation, essentially gasoline base effects, supplies about half and is the piece most exposed to June's gasoline unwind; shelter, despite the largest basket weight at 28%, adds under half a point.
Euro Area
German factory-gate prices for June open the European morning at 08:00 CET. Producer prices rose 2.2% on the year in May, a three-year high, and 0.3% on the month. Consensus looks for a 0.2% monthly fall in June, with the annual rate expected to be near 1.8%. Analysts frame the release as a check on whether June's fall in wholesale energy prices gave refiners and energy-intensive manufacturers some relief, while cautioning that July's energy rebound limits the reassurance policymakers can take from it. Euro-area construction output for May follows at 11:00 CET. The prior reading showed output up 0.9% on the year, and analysts expect a third consecutive monthly increase on the back of firmer national prints in Germany, France and the Netherlands. One tracking estimate has April-May output running about 7% annualised above the first quarter, which would more than offset that quarter's weather-driven contraction. The ECB also publishes its quarterly SAFE survey of firms' access to finance at 09:00 CET, a business-side read on credit conditions two days before Tuesday's bank lending survey, all inside the quiet period.
United Kingdom: A new Prime Minister and a thin data slate: the cabinet list is the market event
The UK data slate holds only the Rightmove house price index for July at 01:01 CET, which showed asking prices down 0.5% on the year in the prior reading. The session's real UK event is political: Andy Burnham is sworn in as Prime Minister after meeting the King, having won the Labour leadership with the backing of roughly 95% of the party's MPs. His cabinet is expected shortly afterwards, and multiple press reports point to Home Secretary Shabana Mahmood, from the party's right, becoming Chancellor, a choice markets have received more favourably than the alternative names floated. Analysts converge on the same watchpoints: the Chancellor's announcement as a signal of fiscal discipline, an early policy emphasis on devolution and social care, and a first policy speech that could come on the same day. Estimates of the fiscal challenge are substantial: one house puts the drop in headroom since the Budget at 15 billion pounds, and another builds a base case of roughly 10 billion in tax rises at the autumn Budget. Ten-year gilt yields sit near 5.00%, and analysts note that, with long-forward inflation swaps marginally below pre-conflict levels, the roughly 75-basis-point rise in yields since the conflict began reflects real-yield and fiscal-risk premiums rather than inflation expectations. Gilts made modest gains on Friday as the leadership contest resolved.
Editor's Note: The market's Monday question is confirmation risk: sterling and gilts have already priced in Mahmood-as-Chancellor reports as good news, so a surprise pick from the party's left would be a shock.
Switzerland: Sight Deposits
In Switzerland, the SNB publishes its weekly update on sight deposits on Monday. These remain far from a perfect proxy for the central bank’s foreign-exchange interventions and are shaped by other factors — liquidity management, quarter-end effects, cross-border flows — yet they are worth monitoring, all the more so now that the SNB has qualified its franc guidance. In its latest assessment, on 18 June, the bank held its policy rate at 0 percent and framed intervention readiness conditionally: “If necessary, the SNB has an increased willingness to intervene in the foreign exchange market” — a qualifier absent from its firmer March wording, when, pointing to the conflict in the Middle East, the bank said its “willingness to intervene in the foreign exchange market has increased.”
Asia-Pacific & Nordics
New Zealand's June merchandise trade figures open the day at 00:45 CET. The monthly balance showed a NZ$0.8 billion surplus in May, on exports of NZ$8.88bn and imports of NZ$8.08bn. Analysts expect the fuel bill to dominate: a seasonal fall in exports combined with elevated fuel import costs could eliminate the monthly surplus, and the annual deficit is seen widening further despite strong exports. The trade data are the curtain-raiser to the week's real New Zealand event, second-quarter CPI at 00:45 CET Tuesday night, where market pricing has a September rate hike about 90% priced and analysts' forecasts cluster between 1.3% and 1.5% on the quarter, driven almost entirely by fuel. India's June infrastructure output follows at 13:30 CET, from a prior reading of 0.5% growth on the year, and South Korea auctions 5-year treasury bonds at 04:30 CET. Japanese markets are closed for Marine Day throughout.
Editor's Note: The kiwi enters the week at a one-month high on the hawkish repricing of the RBNZ, so Monday's trade print is a sideshow to Tuesday's CPI, where the market's 90% September-hike pricing means a soft core reading could unwind more than a hot headline could add.
Central Banks
China: July loan prime rate fixing (03:15 CET). A fourteenth straight month on hold is the universal call, with the easing debate deferred to the autumn
China's commercial banks set the July loan prime rates at 03:15 CET. The calendar consensus is unchanged at 3.0% for the one-year rate, the benchmark for corporate loans, and 3.5% for the five-year rate that anchors mortgage pricing, both matching the prior fixing. The consensus expects no change, which would extend the hold to a fourteenth consecutive month. The backdrop is a second-quarter GDP print of 4.3% year on year, which came in below expectations due to weak domestic demand, and a central bank that has since publicly reiterated a measured easing stance. Analysts broadly agree the next move comes through fiscal policy rather than the rate channel in the near term, with several expecting a policy-rate cut of around 10 basis points late in the third quarter or early in the fourth, which the loan prime rates would then follow. Some point out that compressed bank net interest margins limit how much easing the banking system can absorb.