MNI Gilt Week Ahead - May 17 2021: Lots of data and speeches

• The week ahead will be busy for the UK with a number of data releases, MPC members making speeches and the DMO holding its quarterly consultation meetings. Developments with the India Covid-19 variant will also be watched closely.
• The data calendar is starting to get interesting in the UK with some of the first post-lockdown data to be released. Labour market data on Tuesday will be for March but will have HMRC payroll data for April. However, with most businesses not reopening until April, future months will give more information. Inflation data on Wednesday for the month of April will be closely watched with inflation data remaining at the forefront of the market's concerns. Friday sees the flash PMI release and retail sales. Retail sales for April will give us the best indication so far of the appetite of the consumer, reflecting the month of April during which non-essential retailers were able to reopen. However, the PMI data might not give us much information on the magnitude of the recovery given that it is a diffusion index.
• This week the only MPC members not slated to make public appearances are Haskel and Saunders. Perhaps the most interesting on the calendar are Tuesday's testimony on QE ahead of the Lords Economic Affairs Committee of Bailey, Broadbent and Ramsden. And Friday's speech by non-MPC member but Executive Director for Markets Andrew Hauser as he launches a discussion paper with a speech "Investing for net zero: how central bank monetary policy portfolios can help support orderly transition".
• Today will also see the DMO hold its quarterly consultation meetings with investors and GEMMs to discuss issuance for FQ2 (July to September). We set out our expectations in our publication last week (see link in the main document).
• Today, step 3 on the English lockdown easing roadmap comes into effect. This means that people can now meet indoors in groups of six people (or two households) or outside in groups of up to 30 people and people are now able to hug. More significant from an economic perspective will be the businesses that are able to reopen including hotels, indoor seating areas for pubs and restaurants, cinemas, softplay areas as well as spectators for sporting events (in limited numbers). The India Covid-19 variant will be closely monitored after recent comments from PM Johnson and other senior government officials alluding to the transmissibility of the new strain having an impact on the next stage of the lockdown roadmap which is due to come into effect on 21 June which would see most other restrictions on businesses removed.

GiltWeekAhead17052021.pdf