GLOBAL MORNING BRIEFING: Eyes on Norges Bank, CBRT & Banxico
Public sector net borrowing is seen at 11.5b (down from 17.8b) and around 12.0b (down from 18.6b) net of banking groups. This May’s borrowing is set to be substantially lower than the 17.9b (ex banks) borrowed in May 2021, as pandemic-related costs such as the test-and-trace scheme have come to an end.
France Manufacturing Sentiment (0745 BST)
A modest one-point reduction is anticipated for both French business and manufacturing sentiment indicators, bringing both indexes to 105 and a fresh 15-month low. Growth outlooks and foreign order books are likely to again squeeze expectations, whilst selling prices are seen soaring further.
Flash June PMIs
S&P Global’s flash PMI June round has manufacturing and services PMIs weakening by around 0.5-0.9 points across the board as inflationary pressures are likely to see slowdowns in new orders and demand.
Slumps in manufacturing are expected to marginally outpace those in services, as the added pressure of continued Chinese lockdowns, supply disruptions and volatile commodity prices continue to prove difficult for the industry.
A notable 0.1pp uptick is expected for US services. As such, markets will be watching to see if Summer demand is able to remain robust despite disposable incomes feeling the squeeze.
Norges Bank Rate Decision (0900 BST)
Tighter policy has been well signposted for the Norwegian Central Bank meeting today. Markets have fully priced a 25bps rate rise to 1.00% - and partially a 50bps rise.
While inflation, rates among trade partners and firm oil prices argue in favour of a more sizeable 50bps hike this month, the board are likely to stick to their predictable, steady, “gradual” 25bps due to a unique transmission mechanism and a firm preference for credibility-driven policy.
For our in-depth preview click here.
CBRT Rate Decision (1200 BST)
The CBRT are firmly expected to keep policy rates unchanged for the sixth consecutive month at 14.00%.
The CBRT remains highly politically influenced and willing to look through soaring cost pressures and inflation expectations. Rate hikes remain an unlikely tail risk, with Erdogan this month reiterating his firm opposition to tighter headline rates. As such, most analysts expect rates at 14.00% into year-end. See our preview here.
Banxico Rate Decision (1900 BST)
Banxico are expected to raise rates by 75bps from 7.00 to 7.75% at the June meeting. Continued pressure on core inflation alone may well have justified the more aggressive action, however, a more hawkish Federal Reserve has all but cemented the prospect of Banxico increasing their pace of tightening. Beyond the rate decision, market participants will be particularly attentive to the vote split and whether the statement provides any signalling for future decisions.
Click here for our comprehensive preview.
Today’s key policymaker appearances of interest include the ECB’s President Christine Lagarde and Fed Chair Jerome Powell.| Date | GMT/Local | Impact | Flag | Country | Event |
| 23/06/2022 | 0600/0700 | *** |  | UK | Public Sector Finances |
| 23/06/2022 | 0600/0800 | ** |  | SE | PPI |
| 23/06/2022 | 0645/0845 | ** |  | FR | Manufacturing Sentiment |
| 23/06/2022 | 0715/0915 | | FR | Flash Manufacturing, Services PMI | |
| 23/06/2022 | 0715/0915 | ** | | FR | IHS Markit Services PMI (p) |
| 23/06/2022 | 0715/0915 | ** | | FR | IHS Markit Manufacturing PMI (p) |
| 23/06/2022 | 0730/0930 | ** |  | DE | IHS Markit Services PMI (p) |
| 23/06/2022 | 0730/0930 | ** | | DE | IHS Markit Manufacturing PMI (p) |
| 23/06/2022 | 0800/1000 | *** |  | NO | Norges Bank Rate Decision |
| 23/06/2022 | 0800/1000 |  | EU | ECB Economic Bulletin | |
| 23/06/2022 | 0800/1000 | | EU | Flash Manufacturing, Services PMI | |
| 23/06/2022 | 0800/1000 | ** | | EU | IHS Markit Services PMI (p) |
| 23/06/2022 | 0800/1000 | ** | | EU | IHS Markit Manufacturing PMI (p) |
| 23/06/2022 | 0800/1000 | ** | | EU | IHS Markit Composite PMI (p) |
| 23/06/2022 | 0830/0930 | *** | | UK | IHS Markit Manufacturing PMI (flash) |
| 23/06/2022 | 0830/0930 | *** | | UK | IHS Markit Services PMI (flash) |
| 23/06/2022 | 0830/0930 | *** | | UK | IHS Markit Composite PMI (flash) |
| 23/06/2022 | 1000/1100 | ** | | UK | CBI Distributive Trades |
| 23/06/2022 | 1100/0700 | * |  | TR | Turkey Benchmark Rate |
| 23/06/2022 | - | | EU | ECB Lagarde at European Council Meeting | |
| 23/06/2022 | 1230/0830 | ** |  | US | Jobless Claims |
| 23/06/2022 | 1230/0830 | * | | US | Current Account Balance |
| 23/06/2022 | 1345/0945 | *** | | US | IHS Markit Manufacturing Index (flash) |
| 23/06/2022 | 1345/0945 | *** | | US | IHS Markit Services Index (flash) |
| 23/06/2022 | 1400/1000 | | US | Fed Chair Jerome Powell | |
| 23/06/2022 | 1430/1030 | ** | | US | Natural Gas Stocks |
| 23/06/2022 | 1500/1100 | ** | | US | DOE weekly crude oil stocks |
| 23/06/2022 | 1530/1130 | * | | US | US Bill 08 Week Treasury Auction Result |
| 23/06/2022 | 1530/1130 | ** | | US | US Bill 04 Week Treasury Auction Result |
| 23/06/2022 | 1700/1300 | ** | | US | US Treasury Auction Result for TIPS 5 Year Note |
| 23/06/2022 | 1800/1400 | *** |  | MX | Mexico Interest Rate |