Below are the most important global events likely to affect FX and bond markets in the coming week starting June 17.

Markets await a raft of interest-rate decisions, including in the U.K., Australia, China, Indonesia, Switzerland and Norway, while the performance of French assets will be watched closely as investors get increasingly nervous ahead of snap elections in the country.

U.S. economic data will be scrutinized carefully amid continued uncertainty about when interest-rate cuts will begin after Federal Reserve policymakers forecast just one rate cut for 2024 but data showed slowing inflation.

In Asia, eyes will be on a fresh batch of China data, including home prices, which will be scrutinized for signs that officials' latest round of stimulus measures are boosting the economy, as well as inflation data out of Japan.


U.S.


U.S. Federal Reserve forecasts suggest that interest rates could stay higher for longer, with the prospect of only one rate cut this year, or possibly none at all. Many policymakers still forecast two rate cuts in 2024, however, and investors aren't yet convinced that rate cuts won't come soon, particularly after recent weaker consumer-price and producer-price inflation data.

Money markets currently price in a high chance of a rate cut in September, according to Refinitiv data, but investors will need to see evidence of the economy weakening to confirm this and strong data could easily reverse those expectations.

In that light, U.S. retail sales data and industrial output figures for May due on Tuesday will be closely watched. Focus will also center on provisional manufacturing and services purchasing managers' indexes for June due on Friday. Other forward-looking indicators include the New York Empire State manufacturing index for June on Monday and the Philly Fed index on Thursday.

Housing starts data for May and weekly jobless claims are due on Thursday and existing home sales on Friday.

The coming week could be quieter, however, with a U.S. public holiday on Wednesday.

"The calendar is somewhat data light in terms of top indicators next week," Investec economists said in a note.


CANADA


Investors will parse upcoming Canadian economic data as they assess whether the Bank of Canada could follow up the interest-rate cut it announced earlier this month with another at next month's meeting.

Canadian housing starts data for May are due on Monday, followed by retail sales data for April, and May producer prices data on Friday.


BRAZIL


Brazil's central bank announces a decision on Wednesday and is expected to keep the Selic rate unchanged at 10.50% as inflation expectations creep up.

"We have come to expect that the Copom [the central bank's monetary policy committee] will no longer promote interest rate cuts this year and will only resume them in 2025," analysts at Rabobank said in a note.


EUROZONE


French assets, particularly government bonds and banking stocks, will remain in focus as investors become increasingly nervous ahead of snap elections, with the first voting round due to be held on June 30.

Markets will be scrutinizing opinion polls that are showing strong support for Marine Le Pen's far-right National Rally party, raising concerns about potential political gridlock and excessive fiscal spending. In that light, the European Commission's publication of a report on excessive deficit procedures on Wednesday could attract attention.

Eurozone economic data are expected to show a continued improvement in the region's economy, leaving uncertainty over when the European Central Bank will cut interest rates again.

The central bank cut rates in June but was cautious about signaling further moves due to concerns about inflation. Money markets currently price in a significant chance of another rate cut in September, with a reduction fully priced in for October.

Provisional purchasing managers' surveys for June covering the manufacturing and services sectors' activity in Germany, France and the eurozone due on Friday will be watched closely for up-to-date indications of how the economy is faring.

"According to our forecast, the purchasing managers' indices for June in the eurozone are set to show an overall consolidation of the recent improvement in sentiment," analysts at LBBW said in a note.

Eurozone final inflation data for May and Germany's ZEW economic expectations survey for June will be released on Tuesday, while the eurozone flash consumer confidence indicator for June is due on Thursday.

Slovakia and Belgium will hold bond auctions on Monday, while Greece will sell bonds on Wednesday and Spain on Thursday. Germany and France will each conduct two auctions. Germany will offer EUR4 billion in April 2029 federal notes, or Bobl, on Tuesday and EUR2 billion in August 2054 Bund on Wednesday. On Thursday, France will auction short- and medium-term bonds and will also sell inflation-linked bonds at a separate auction.


U.K.


A Bank of England decision on Thursday and inflation data on Wednesday will be the highlight of a busy week in the U.K.

The Bank of England is widely expected to keep interest rates on hold at 5.25% given recent data showing U.K. wage growth and services inflation remain elevated. Policymakers could also be reticent about making any moves ahead of a general election on July 4, where the opposition Labour Party is widely expected to win.

"We remain of the view that both wage growth and services inflation don't align yet with a sustained return to 2% inflation," said Stefan Koopman, senior macro strategist at Rabobank, in a note.

Focus will center on any clues as to when rates could be cut, whether in August or later, and on how many of the nine BOE policymakers vote to reduce rates. Money markets currently price in a 43% chance of a rate reduction in August, according to Refinitiv data.

Deutsche Bank Research expects the BOE to start interest-rate cuts in August but said it will first need to see more evidence of easing inflationary pressures.

"We think the risks of a further delay to the start of any rate cuts is on the rise, with an August rate cut looking more finely balanced," analysts at the bank said in a note.

U.K. consumer-price and producer-price inflation data for May on Wednesday could provide clues on the rate outlook ahead of the BOE's decision. Analysts see a possibility that headline annual CPI inflation could fall back to the BOE's 2.0% target in May.

A slew of data on Friday will also give indications on how well the economy is performing. Retail sales and public sector finances data for May are due, though the biggest focus will be on provisional purchasing managers' surveys on manufacturing and services sector activity during June.

"The details of May's [PMI] report hinted that momentum in activity could have carried on into June. In particular, intakes of new work improved in manufacturing and optimism on future production rose. For service sector firms, new orders growth cooled but was still positive, and business optimism saw a small gain too," said Investec economist Sandra Horsfield in a note.

The U.K. Debt Management Office plans to sell the July 2029 conventional gilt on Tuesday.


SWITZERLAND


A decision by the Swiss National Bank is due on Thursday amid uncertainty about whether or not it will opt to cut rates again after a surprise reduction at its meeting in March.

Analysts at UniCredit Research have revised their forecasts and now expect the SNB to keep its key rate on hold at 1.50%, having previously forecast another 25 basis-point cut, due to a "robust Swiss economy" and "slightly higher inflation rates in recent months."

Analysts at ING, however, expect another rate cut and argue that the fact the central bank only meets once a quarter gives it fewer opportunities to move rates.


SCANDINAVIA


Norges Bank, Norway's central bank, announces a decision on Thursday and is widely expected to hold interest rates at 4.5% and to reiterate that rates will stay unchanged for some time ahead due to elevated inflation and a solid economy.

Many analysts expect that the central bank's policy rate path will signal that a cut isn't likely until December.

Analysts at SEB point to the fact that Norges Bank's recent Regional Network Survey reported higher expected growth and rising capacity utilization, with wage growth expectations increased. They expect this will justify interest rates being left on hold for a longer period that those of many European peers.

Denmark and Sweden will hold bond auctions on Wednesday.


HUNGARY


Hungary's central bank announces an interest-rate decision on Tuesday, with another cut in the key rate likely from its current level of 7.25%.

"We once again see a cautious central bank that could cut the key rate by only 25 basis points to 7.00% in our view," ING analysts said in a note. "Moreover, it may signal even less (or no) room for further rate cuts in the coming months than in its May forward guidance."


AUSTRALIA


The Reserve Bank of Australia is expected to remain vigilant to inflation risks when it announces a policy decision on Tuesday and publicly reveal once again that it has discussed tightening policy settings.

The official cash rate is almost certainly set to remain at 4.35%, with RBA Governor Michele Bullock repeating recent guidance that all policy options remain on the table.

Bullock faces a mixed economic picture with GDP growth barely detectable in the first quarter of the year, despite a backdrop of stubborn price pressures where inflation data has delivered repeated upside surprises.

Bullock told parliament last week that the RBA remains ready to do whatever is necessary to stymie inflation and get it back into the 2% to 3% target band within a reasonable timeframe.

How the RBA views government rebates on rents and electricity bills to reduce cost pressures will feature prominently at Bullock's press conference, as will coming stimulus from a rise in basic wages and the delivery of income tax cuts.

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06-16-24 1814ET