Macro

UK:

Consumer price growth in the UK slowed to 7.9% in June from 8.7% in May, mainly due to lower gasoline prices. This slowdown in inflation exceeded expectations and aligned with the forecast of the Bank of England (BoE). BoE Deputy Governor David Ramsden acknowledged the significant fall in CPI inflation but emphasized that it remains too high, and monetary policy decisions will address the risk of persistent strength in domestic wage and price settling.

EU:

The eurozone economy avoided a recession in the first quarter of the year, with revised figures showing no contraction, as previously estimated. The gross domestic product remained flat in the first three months, up from the initial estimation of a 0.1% contraction. Notably, two leading European Central Bank (ECB) officials, Dutch central bank governor Klaas Knot and Bundesbank chief Joachim Nagel appeared to moderate their stance on future interest rate increases. Knot mentioned that core inflation seems to have “plateaued,” and any decision on raising interest rates beyond July is a possibility but not a certainty. Nagel, who has advocated for more rate hikes, stated that the decision on raising rates in September would depend on incoming data.

US:

Retail sales in June increased by 0.2% sequentially, falling short of the 0.6% consensus estimate. May’s data was revised upward, showing a growth rate of 0.5% from the initial reading of 0.3%. New filings for unemployment benefits declined for the second consecutive week, reaching their lowest level since May, surpassing economists’ expectations. U.S. Treasury Secretary Janet Yellen expressed confidence that the U.S. would not slip into a recession, highlighting the resilience of the labor market and the slowing inflation. However, the Conference Board’s Leading Economic Index, which predicts U.S. economic activity, decreased for the 15th consecutive month in June, primarily due to weaknesses in consumer sentiment, new orders, and housing construction.