Inflation and consumer spending reports are due from the U.K. economy this week, but the flash PMI reports might be the ones to watch out for.
Here’s what’s coming up:
Inflation data (Feb. 17, 7:00 am GMT)
- Headline CPI for January to dip from 0.6% to 0.5% year-over-year
- Core CPI to drop from 1.4% to 1.2% y/y for the same month
- PPI input prices probably rose by 0.5% m/m while output prices increased by 0.2%
Retail sales (Feb. 19, 7:00 am GMT)
- Consumer spending likely tumbled by 2.6% in January after earlier 0.3% uptick
- Note that consumer spending accounts for majority of overall economic activity, so sharper than expected fall would mean weaker growth prospects
- Manufacturing index likely dipped from 54.1 to 53.1 in January, reflecting a slower pace of industry expansion
- Services index probably improved from 39.5 to 42.3 to signal a slower pace of contraction
- Even though there have been some upgrades to earlier results, weaker than expected figures might still drag the pound lower
Technical snapshot
- Stochastic shows that Cable, Guppy, GBP/NZD, and GBP/CHF are overbought
- This oscillator puts EUR/GBP in the oversold region and the rest in neutral territory
- Sterling has been most volatile against the Kiwi in the past seven days, moving an average of 116.1 pips per day
