MNI GLOBAL MORNING BRIEFING: UK, Canada, SA Inflation Due

May inflation data is due for three key economies today: the UK, South Africa and Canada. Continued price growth is anticipated across the board as both global energy prices remain elevated and spillover inflation, especially food, sees further upticks.

Further drivers of May inflation will be China’s Covid lockdowns and sustained supply shortages boosting input costs over the month.

UK Inflation (0700 BST)

UK CPI is projected to tick up a further 0.1pp to 9.1% in May, with the core measure expected to see a modest 0.2pp step down to a still very hot 6.0%. The BOE highlighted last week that the core print is of particular concern, outpacing levels seen in the US and Eurozone.

Factory-gate inflation will also have accelerated in May, up 0.7pp and 0.8pp to +14.7% y/y and +19.4% y/y for output and input price inflation respectively. However, some analysts point to recent UK survey data that suggests factory gate inflation may be near peak.

South Africa Inflation (0900 BST)

A further 0.2pp uptick to +6.1% y/y is anticipated for South Africa’s May inflation print, which would break the 3-6% SARB target range as the central bank accelerates its normalisation path following the uptick to a 50bp hike in May. Core inflation is also seen up 0.2pp at +4.1% y/y.

Canada Inflation (1330 BST)

Canadian CPI is seen hitting the 7.3% mark in May (up 0.5pp), which would outpace or match the 1991 high of 6.9%.

The May print will include new weights and used vehicles, which were previously omitted, adding a likely upside surprise to the forecast. This jump would make for uncomfortable news for the BoC, adding likelihood to the BoC following the Fed’s example and hiking 75bp at the July 13 meeting.

Eurozone Consumer Confidence (1500 BST)

The European Commission’s flash Eurozone Consumer Confidence is projected to recover by a modest 0.6 points to -20.5 in the June flash estimate. Further improvements in weak optimism are anticipated, and the key focus will again be on any big moves in price expectations.

Notable speakers on Wednesday’s schedule include the ECB’s Vice President Luis de Guindos and Exective Board member Frank Elderson, as well as the BOE’s Jon Cunliffe. Fed Chair Jerome Powell, Richmond Fed's Tom Barkin, Philadelphia Fed’s Patrick Harker and the BOC’s Deputy Rogers will all be due in the afternoon.

Date	GMT/Local	Impact	Flag	Country	Event
22/06/2022	0600/0700	***		UK	Consumer inflation report
22/06/2022	0600/0700	***		UK	Producer Prices
22/06/2022	0600/0800	**		SE	Unemployment
22/06/2022	0700/0900			EU	ECB de Guindos Q&A at Universidad Internacional Menendez Pelayo
22/06/2022	0735/0935			EU	ECB Elderson Speech on Climate & Q&A at Frankfurt School of Finance
22/06/2022	0830/0930	*		UK	ONS House Price Index
22/06/2022	0840/0940			UK	BOE Cunliffe Panels Point Zero Forum
22/06/2022	1100/0700	**		US	MBA Weekly Applications Index
22/06/2022	1230/0830	***		CA	CPI
22/06/2022	1255/0855	**		US	Redbook Retail Sales Index
22/06/2022	1300/0900			US	Richmond Fed President Tom Barkin
22/06/2022	1400/1600	**		EU	Consumer Confidence Indicator (p)
22/06/2022	1400/1000			US	Fed Chair Jerome Powell
22/06/2022	1440/1040			CA	BOC Deputy Rogers "fireside chat"
22/06/2022	1530/1130	**		US	US Treasury Auction Result for 2 Year Floating Rate Note
22/06/2022	1530/1130	*		US	US Treasury Auction Result for Cash Management Bill
22/06/2022	1600/1200			US	Richmond Fed's Tom Barkin
22/06/2022	1700/1300	**		US	US Treasury Auction Result for 20 Year Bond
22/06/2022	1730/1330			US	Fed's Patrick Harker and Tom Barkin