| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 09:00 | Germany | ZEW Survey - Economic Sentiment | June | 47.1 | 50 | 47.5 |
| 09:00 | Eurozone | ZEW Economic Sentiment | June | 47 | 47.8 | 51.3 |
| 09:00 | Eurozone | Harmonized CPI, Y/Y | May | 2.4% | 2.6% | 2.6% |
| 09:00 | Eurozone | Harmonized CPI ex EFAT, Y/Y | May | 2.7% | 2.9% | 2.9% |
| 09:00 | Eurozone | Harmonized CPI | May | 0.6% | 0.2% | 0.2% |
GBP weakened against most of its major counterparts in the European session on Tuesday as investors prepared for the release of the UK inflation data for May and the announcement of the Bank of England’s interest-rate decision later this week.
Investors will receive Britain’s May inflation figures on Wednesday - a day before the BoE’s monetary policy committee (MPC) announces the outcomes of its June meeting. Economists forecast the data will show a deceleration in headline CPI to 2.0% YoY in May, down from 2.3% YoY in the previous month. This would be the first time the British CPI returns to the BoE's 2% target since July 2021. Meanwhile, the core CPI is expected to moderate to 3.5% YoY from 3.9% YoY in April. This would mark the lowest core rate since October 2021 (3.4% YoY).
The BoE's MPC is widely anticipated to keep its benchmark rate - the Bank Rate - unchanged at 5.25% at its upcoming meeting, the outcomes of which will be published on Thursday.
Markets will scrutinise the BoE’s policy statements for clues on when the members of its MPC plan to deliver the first interest rate cut.
Currently, markets are pricing in just under two cuts for this year, with the first one expected to come in August.
If Wednesday’s CPI figures match expectations they will give the BoE additional confidence to begin policy easing in August.