EUROPEAN SESSION:
In the European session, we don't have much on the agenda other than a couple of low-tier releases like the Swiss PPI and the Eurozone Industrial Production. None of the data is going to change anything for the respective central banks, so the market reaction will likely be muted.
As a reminder, the SNB held interest rates steady last week as widely expected and donwgraded slightly inflation forecasts for 2026 and 2027. Nevertheless, the general tone was more upbeat due to the recent breakthrough in US tariffs that were lowered to 15% vs 39% prior.
On the ECB side, the central bank is comfortably on the sidelines and just keeps monitoring the economic developments. Most ECB members have repeatedly said that they won't respond to small or short-term deviations from the 2% target, while also adding that the next move could even be a rate hike if economic conditions warrant such a move.
AMERICAN SESSION:
In the American session, the main highlight will be the Canadian CPI report. The most important data to watch will be the underlying inflation measure, that is the Trimmed Mean CPI Y/Y, which is expected at 2.9% vs 3.0% prior.
The BoC last week held interest rates steady but didn't validate the market's rate hike bets just yet. In fact, the central bank kept a cautious tone and highlighted the weak details in the recent GDP and employment reports despite acknowledging the improvements. The market is still fully pricing a rate hike by the end of 2026.
CENTRAL BANK SPEAKERS:
- 14:30 GMT/09:30 ET - Fed's Miran (dove - voter)
- 15:30 GMT/10:30 ET - Fed's Williams (dovish - voter)
- 16:00 GMT/11:00 ET - Fed's Miran (dove - voter)
