Focus of yesterday's session was on UK Budget releases. Philip Hammond tried to talk up the U.K. economy, but the numbers don’t back him up. In 2021, when the U.K.’s Brexit transition will have ended, the government’s budget watchdog lowered its growth forecast. What’s more, it looks like the country is going to be paying money to the European Union for decades to come, well into 2060. The U.K. chancellor is in an bind: voters are angry after eight years of austerity but Hammond lacks the resources to be able to significantly relax the pain. At the same time his Conservative Party is deeply divided on how to tackle Brexit, and he falls firmly in the camp of those in the party that fear there is no bright side to quitting the world’s biggest trade bloc.
In the US session CPI data was published. The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in February on a seasonally adjusted basis after rising 0.5 percent in January, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months,nthe all items index rose 2.2 percent before seasonal adjustment. The indexes for shelter, apparel, and motor vehicle insurance all rose and contributed to the 1-month seasonally adjusted increase in the all items index. The food index was unchanged in February, as a decline in the index for food at home offset an increase in the food away from home index.
There will be no major data releases from the UK tomorrow. In the US session Retail Sales and PPI figures will be released. Analysts predict 0.1% increase in PPI and 0.3% growth in Retail Sales.
Figures to watch:
PPI (Wednesday 14:30)
Retail Sales (Wednesday 14:30)