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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.
The highlights of Thursday's European session include the release of the European Commission's Economic Sentiment Indicator at 1000BST and German flash inflation at 1300BST. In the US, the publication of flash GDP will be closely followed at 1330BST.
EZ ESI seen higher in July
The EZ Economic Sentiment Indicator rose to a 21-year high in June at 117.9 and markets expect the index to rise further in July to 118.5. July's increase would be the sixth consecutive gain. June's increase was broad-based with every category posting a monthly gain. The service and retail trade sector did particularly well, with sentiment rising to the highest level since 2007 for services and to a 42-month high for retail trade.
The continued easing of restrictions in July in many European countries should provide a boost to economic sentiment in July, although the spread of the Delta variant and rising infection rates pose a downside risk in the coming months. The flash EZ composite PMI is in line with market forecast. It rose to a record high in July.
German inflation forecast to rise significantly
Flash inflation in Germany is expected to accelerate again in July to 2.9%, after the annual rate ticked down to 2.1% in June. June's slowdown was led by a weaker increase of energy prices. The main driver of July's increase is set to be the German VAT cut, which was introduced in July 2020 and led to a decline of the consumer price index between August 2020 and December 2020. As a result, base effects due to the VAT cut will push up German inflation in the coming months.
US GDP expected to rise
Annualized US GDP is forecast to rise by 8.4% in the second quarter of 2021, following a growth rate of 6.4% in the first quarter of the year. In Q1, personal consumption expenditure, non-residential and residential fixed investment, government spending increased, while private inventory investments and exports declined. Personal consumption is forecast to rise by 10.5% in Q2, following a growth rate of 11.4% in the previous quarter. The GDP price index is expected to accelerate to 5.4%, up from 4.3%. seen in Q1.
The events calendar remains quiet again with no speeches scheduled for the day.
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.