Tuesday preview: UK inflation data expected to show improvement

UK inflation data on Tuesday is expected show a pick-up in consumer prices in August.

The consumer price index (CPI) is forecast to rise 0.4% in August compared to a month ago, following a 0.1% month-on-month drop in July. On the year inflation is estimated to increase 0.7% after a 0.6% year-on-year rise.

“Although petrol prices fell in August, base effects will continue to lift the year-on-year inflation rate,” according to HSBC analysts.

“We expect CPI inflation to push up to 0.7% year-on-year, driven by continued easing in goods price deflation. Indeed, the 'operation of personal transport' component of the CPI may well rise in year-on-year terms in August, for the first time since January 2014.”

Ipek Ozkardeskaya, senior market analyst at London Capital Group, said the pound is likely to receive a boost on a positive surprise in the CPI data.

“However, a negative surprise should keep the pound under pressure, but with a limited downside given that the expectations for a further Bank of England rate cut has fallen substantially,” she said.

“In fact, the post-Brexit era will last years rather than months. In this perspective, the BoE is expected to use the policy tools efficiently over time, rather than all-at-once. As a result, the recovery in the UK yields reflects the meagre 22% chances for a December rate hike in the UK. This probability is expected to further dampen and in turn, to underpin the recovery in the UK yields.”

Tuesday 13 September

INTERIMS
Attraqt Group , Corero Network Security, Escher Group Holdings, Flowtech Fluidpower, Futura Medical, Goals Soccer Centres, Hilton Food Group, JD Sports Fashion, Manx Telecom , Netplay TV, SafeCharge International Group Limited (DI), STM Group, TP Group, Verona Pharma

INTERIM DIVIDEND PAYMENT DATE
Mondi

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Price Index (GER) (07:00)
ZEW Survey (EU) (10:00)
ZEW Survey (GER) (10:00)

Q2
Netplay TV

FINALS
Kalibrate Technologies

AGMS
Aberdeen Private Equity Fund Ltd. Sterling Part Shares, Abzena, Cohort, Daejan Holdings, Empyrean Energy, Imaginatik, Solid State

UK ECONOMIC ANNOUNCEMENTS
Consumer Price Index (09:30)
Producer Price Index (09:30)
Retail Price Index (09:30)