Economic calendar: European inflation and US consumer confidence

Summary:

• European inflation for April to shed first light on price trends in the Eurozone
• Advance reading of GDP from the Eurozone economy
• Canadian GDP and US consumer confidence on the agenda in the afternoon

European inflation - France/Spain/Portugal/Italy/Germany (7:45/8:00/9:30/10:00/1:00 GMT): After ending the asset purchase program at the end of the past year, the European Central Bank switched to a more dovish stance in the first quarter of 2019 seeking new measures to revive the stuttering economic growth. It seems that reaching the inflation objective at a sustained manner is a pipe dream. Therefore, it’s unlikely the ECB to embrace a more hawkish stance in the upcoming months unless core inflation accelerates markedly. Preliminary readings from the above-mentioned European economies are expected to bring higher values compared to those seen in March.

10:00 am GMT - Advance GDP from the Eurozone economy: The Eurozone economy is forecast to have grown 0.3% over the first three months of the year compared to the previous quarter or 1.1% in annual terms. The data will show how much the weak manufacturing performance in Europe in recent months weighed on economic growth.

1:30 pm GMT - Canadian GDP: The Canadian dollar lost momentum last week after the Bank of Canada abandoned its rate hike bias. At the same time the BoC decided to slash economic growth forecasts. Since then the USDCAD has been trading at relatively elevated levels, hence today’s monthly GDP report for February could affect traders’ expectations for monetary policy in Canada. The consensus suggests 0% MoM after rising 0.3% MoM in January.

3:00 pm GMT - US conference board index: The first quarter in the US economy turned out to be surprisingly solid at least when one focus on headline GDP growth (3.2% QoQ, annualized). The details were less encouraging suggesting a weaker position of private consumption. On the other hand, the underlying trend on personal income growth remains still at a decent level and remarkably stable (+4% YoY) and it should support consumer spending over the next couple of months. Having this in mind consumer sentiment in April is forecast to have improved to 126.8 from 124.1. Let us note that Chicago PMI for April will be released 15 minutes earlier. The consensus sees a slight decrease to 58.5 from 58.7.

The USDCAD is rising today after a few days of falls. Bulls may aim for the post-BoC high placed at around 1.3520. Source: xStation5