Week ahead: UK inflation data in focus as markets eye rate cuts
UK economic data will likely steal the show next week, with a barrage of leading indicators scheduled for release, including the all-important consumer price index (CPI) for December as markets continue to speculate over when the Bank of England will begin to loosen monetary policy.
Due on Wednesday, the CPI is forecast to show prices gained 0.1% month-on-month after a 0.2% fall in November, though the annual rate of inflation is expected to have eased to 3.8% from 3.9%. Core inflation, meanwhile, is tipped to have slowed to 4.9% last month, down from 5.1% in November.
However, any upside surprise may temper expectations for a sooner-than-expected interest-rate cut from the Bank of England. That comes after a stronger-than-expected rebound in UK GDP in November, according to numbers released on Friday this week.
"With core inflation still lingering well above target at 5.1%, housing markets continuing to be robust, and economic data coming out above expectations, it is hard to imagine the BoE beginning an aggressive cutting cycle," said Tim San Wong, Global Capital Markets associate at Validus Risk Management.
However, economists at Oxford Economics pointed out that, looking forward, the combination of lower oil and wholesale gas prices, along with softer core price pressures, "should generate a much quicker fall in inflation than we previously anticipated".
They said: "We now think that inflation will return to the Bank of England's 2% target as soon as April. If we're right, it would mean that inflation comes in 2ppts below the BoE's latest forecast in Q2. Against this backdrop, we expect the Monetary Policy Committee to steadily back down from their hawkish rhetoric. We expect the first cut in Bank Rate to come in May, with three further 25bps cuts following before the end of the year."
On Monday, UK labour-market figures are scheduled and are forecast to show that the amount of people claiming jobless benefits increased by just 3,000 in December, after the 16,000 growth seen the month before.
Friday will see the release of UK retail sales for December, which are estimated to have rose by just 0.4%, slowing from the 1.3% growth seen in November. However, annual growth is expected to 2.1% from 0.1% the previous month.
It's another week before US earnings season really steps up a gear, with only a handful of NYSE-listed stocks due to report quarterly results. However, two heavy hitters will be publishing on Tuesday: Goldman Sachs and Morgan Stanley.
A flurry of trading updates from UK-listed names are also scheduled for next week, including PageGroup, Experian, Ocado, 888 Holdings, and AJ Bell, Currys, Dunelm, Flutter Entertainment, Hays and Sage Group.
Monday January 15
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Trade (EU) (10:00)
Industrial Production (EU) (10:00)
Wholesale Price Index (GER) (07:00)
Q4
Pagegroup
GMS
88 Energy Limited (DI), Mondi, Pantheon Resources, Strip Tinning Holdings
FINALS
Ramsdens Holdings
ANNUAL REPORT
Ramsdens Holdings
TRADING ANNOUNCEMENTS
Pagegroup
FINAL DIVIDEND PAYMENT DATE
Witan Investment Trust Plc
FINAL EX-DIVIDEND DATE
Leeds Building Society 13 3/8% Bearing Shares
Tuesday January 16
INTERIM DIVIDEND PAYMENT DATE
NewRiver REIT, Norcros
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Price Index (GER) (13:00)
Consumer Price Index (GER) (07:00)
Unemployment Rate (07:00)
ZEW Survey (EU) - Economic Sentiment (10:00)
ZEW Survey (GER) - Current Situation (10:00)
ZEW Survey (GER) - Economic Sentiment (10:00)
GMS
Gelion
EGMS
China Yangtze Power Co., Ltd GDR (Reg S)
AGMS
Catalyst Media Group
TRADING ANNOUNCEMENTS
Cairn Homes (CDI), Experian, IntegraFin Holding, Ocado Group, QinetiQ Group
UK ECONOMIC ANNOUNCEMENTS
Claimant Count Rate (07:00)
Wednesday January 17
INTERIMS
Frontier Developments, Gateley (Holdings)
INTERIM DIVIDEND PAYMENT DATE
Northern 2 VCT, Northern 3 VCT, Northern Venture Trust
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Business Inventories (US) (15:00)
Capacity Utilisation (US) (14:15)
Consumer Price Index (EU) (10:00)
Import and Export Price Indices (US) (13:30)
Industrial Production (US) (14:15)
MBA Mortgage Applications (US) (12:00)
Retail Sales (US) (13:30)
Retail Sales Less Autos (US) (13:30)
GMS
Orcadian Energy
FINALS
Oxford Biodynamics , Safestore Holdings
AGMS
Diploma, Kazera Global, Majedie Investments, Orcadian Energy
TRADING ANNOUNCEMENTS
888 Holdings (DI), Ibstock , Liontrust Asset Management, Rathbones Group
UK ECONOMIC ANNOUNCEMENTS
Consumer Price Index (07:00)
Producer Price Index (07:00)
Retail Price Index (07:00)
Thursday January 18
INTERIM EX-DIVIDEND DATE
Amedeo Air Four Plus Limited Red Ord NPV, Elixirr International , NB Private Equity Partners Ltd.
QUARTERLY EX-DIVIDEND DATE
Custodian Property Income Reit, I3 Energy , JpMorgan China Growth & Income , JPMorgan Japan Small Cap Growth & Income, M Winkworth, Pollen Street
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Building Permits (US) (13:30)
Continuing Claims (US) (13:30)
Crude Oil Inventories (US) (16:00)
Current Account (EU) (09:00)
Existing Home Sales (US) (15:00)
Housing Starts (US) (13:30)
Initial Jobless Claims (US) (13:30)
Philadelphia Fed Index (US) (13:30)
Q4
Centamin (DI)
SPECIAL EX-DIVIDEND DATE
B&M European Value Retail S.A. (DI), Property Franchise Group, Unicorn AIM VCT
AGMS
Baillie Gifford European Growth Trust , Cardiff Property, Topps Tiles
TRADING ANNOUNCEMENTS
AJ Bell, Bakkavor Group , C&C Group (CDI), Currys , Dunelm Group, Elementis, Flutter Entertainment (CDI), Harbour Energy , Hays, Sage Group, W.A.G Payment Solutions
UK ECONOMIC ANNOUNCEMENTS
RICS Housing Market Survey (00:01)
FINAL EX-DIVIDEND DATE
Cardiff Property, Compass Group, Dewhurst Group, Dewhurst Group 'A'NON.VTG, Diploma, Future, Gooch & Housego, Orchard Funding Group , Origin Enterprises (CDI), Premier Miton Group
Friday January 19
INTERIM DIVIDEND PAYMENT DATE
Babcock International Group, Dunedin Enterprise Investment Trust, Halfords Group, MS International, Speedy Hire, Vertu Motors
QUARTERLY PAYMENT DATE
Real Estate Investors
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Producer Price Index (GER) (07:00)
SPECIAL DIVIDEND PAYMENT DATE
Foresight Enterprise VCT
AGMS
Character Group, Focusrite
TRADING ANNOUNCEMENTS
4Imprint Group
UK ECONOMIC ANNOUNCEMENTS
Retail Sales (07:00)
FINAL DIVIDEND PAYMENT DATE
Aeorema Communications, Northamber, Redcentric