Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Wednesday is a big day for inflation data across the globe, with the UK, South Africa and Canada April prints due. The Eurozone’s final April print will also be published.
UK Inflation (0700 BST)
Tuesday’s UK inflation report could see headline inflation hitting 9.1% y/y in April, up a substantial 2.1pp on March. A surge of 2.6% m/m is anticipated, quickening from 1.1% m/m. From last month, the ceiling on domestic energy prices rose by 54% to £1971 annually -- a further increase is likely in October.
While the Bank of England has consistently underestimated the rise in inflation, an as-expected outcome would be broadly in line with the Bank’s forecasts. According to minutes of the May Monetary Policy meeting, CPI is likely to top 9% in the second quarter, before “averaging slightly over 10%” in the closing months of the year.
Core inflation highlights that underlying price growth remains strong, seen up 0.5pp at 6.2% y/y.
South Africa Inflation (0900 BST)
South African inflation is expected to hold steady at 5.9% y/y in April, unchanged from March. Core inflation is also seen unchanged at 3.8% y/y.
Record fuel prices and food prices running hot account for the bulk of inflationary pressure. With inflation at the top of the 3-6% target range, a 50bp hike is priced in for the upcoming SARB meeting tomorrow. The SARB has had its hand pushed to hike more than initially anticipated due to the Ukraine supply shock and the Fed's hawkish hiking cycle.
Eurozone Final April Inflation (1000 BST)
Eurozone headline number is seen coming in at 7.5% y/y, unchanged on both the flash read and the final March number.
This follows the European Commission’s Spring forecasts which saw growth expectations on the back of the Ukraine war outbreak and associated energy price inflation, supply chain disruptions and widespread uncertainty. The EC sees inflation averaging 6.1% for 2022.
Canadian Inflation (1330 BST)
The April inflation number for Canada is seen unchanged at 6.7% y/y, whilst a deceleration to +0.5% m/m is expected, down from +1.4% m/m in March. With CPI at the highest rate since 1991, Former BOC adviser Steve Ambler told MNI that the BOC may find itself having to hike 75bp out of necessity at the June 1 meeting.
US Housing Starts & Building Permits (1330 BST)
In non-inflation news today, US housing starts and building permits are both seen slowing marginally in April, housing starts slowing by 24k to 1759k and building permits down by 50k to 1820k. These levels remain highly elevated.
The ECB’s President Christine Lagarde & Fabio Panetta will be participating in the G7 Finance Minister’s Meeting for the rest of the week and Philadelphia Fed's Patrick Harker is due to speak on economic outlooks.| Date | GMT/Local | Impact | Flag | Country | Event |
| 18/05/2022 | 0600/0700 | *** |  | UK | Consumer inflation report |
| 18/05/2022 | 0600/0700 | *** | | UK | Producer Prices |
| 18/05/2022 | 0830/0930 | * | | UK | ONS House Price Index |
| 18/05/2022 | 0900/1100 | *** |  | EU | HICP (f) |
| 18/05/2022 | 1100/0700 | ** |  | US | MBA Weekly Applications Index |
| 18/05/2022 | - | | EU | ECB Lagarde & Panetta in G7 Meeting | |
| 18/05/2022 | 1230/0830 | *** |  | CA | CPI |
| 18/05/2022 | 1230/0830 | *** | | US | Housing Starts |
| 18/05/2022 | 1430/1030 | ** | | US | DOE weekly crude oil stocks |
| 18/05/2022 | 1700/1300 | ** | | US | US Treasury Auction Result for 20 Year Bond |
| 18/05/2022 | 2000/1600 | | US | Philadelphia Fed's Patrick Harker |
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.