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Home » Popular Markets » Economics » The Week Ahead » The UK, US and the Eurozone in the week ahead
  • US inflation tipped to cool a little from May’s highs
  • UK inflation still set to charge higher, raising concerns amongst policymakers
  • UK employment data likely to show further improvements in short term position


Price pressures are very much front of mind for policymakers right now so Tuesday’s release of US Inflation data for June will be closely followed. With the May reading having hit 5%, expectations are that there may be a modest cooling seen this time round, possibly assisted by the Chinese PPI reading which came in below expectations. However with the US economy running so hot, even a modest decline won’t be sufficient to deflect those calls for policy tightening.

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On Wednesday the focus will remain on Inflation with June’s UK data set to be published. This is expected to show a meaningful advance on the 2.1% struck in May and could climb towards 2.5%. Of equal significance will be the Producer Price Index as this has the ability to offer some insight as to future retail price inflation trends. On that basis, further expansion here has the potential to raise fresh concerns as to just how quickly this inflationary spike will abate.

Eurozone Industrial Production for May will also be released on Wednesday, with the month-on-month reading here set to be the more meaningful, given the annualised readings are still catching the start of the pandemic’s lockdown. Having printed at 0.8% in April, a modest decline to around 0.4% is being called – the real concern here would be slipping back into negative territory.

And back to inflation as Wednesday also sees US PPI data for June issued. As this reflects factory gate prices, it has a subsequent impact on profitability and/or prices, so either way it’s difficult to find the upside in an overly hot reading here. Expectations are for the annualised reading to come in around 6.8%, up from the 6.6% recorded in May.


Thursday sees the latest UK Employment data being released. This covers a range of metrics, but the claimant count for June is tipped to decline for a fourth consecutive month. There’s still the risk that this figure could snap back sharply later in the year as government support for business runs out, but for now this should support the idea of a faster economic recovery. Equally significant in light of inflationary pressures is the UK Average Earnings for May. Excluding bonuses, the market is looking for something very close to the previous month’s 5.6%  and this would again help lift consumer confidence – although the inevitability of fiscal intervention in due course can’t be overlooked, either.


Rounding off a relatively quiet week, Friday sees the release of US Retail Sales for June. The month-on-month print looks set to struggle to reach positive territory, although these readings have been somewhat distorted by the recent run of stimulus cheques. With that in mind, it’s perhaps delivering an improvement on May’s -1.3% that carries the most significance here.


This article is not investment advice. Investors should do their own research or consult a professional advisor.

Tony Cross

Tony Cross

Tony Cross is a market commentator with over 15 years of experience, producing compelling, insightful copy for journalists and investors alike. Focusing on macroeconomics, UK blue chip equities and inter market analysis, Cross's commentary is well regarded for its clarity and ability to cut through the waffle. He has been quoted in publications as diverse as The Financial Times, The Times, The Guardian and The Sun. He has also been a regular guest on both Share Radio and TipTV.

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