Weekly Focus Sweden: Inflation Pressure Still Missing

Published 06/23/2017, 07:04 AM

Market movers ahead

Inflation readings for both the US and the euro area will be clearly below central bank targets, both on actual and core measures.

European growth indicators have remained high while others have weakened, but we expect to start seeing a decline in IFO numbers this week.

China's official PMI may start to show more weakness.

We are optimistic on Swedish exports this year, and hopefully that will be reflected in the upcoming trade data.

Lower unemployment and higher consumer spending could add to the increasing optimism in Norway.

Global macro and market themes

Supply/demand dynamics suggest the oil price may fall further near term.

Falling inflation expectations are driven by weaker demand and the lack of a monetary policy response.

A hard Brexit is still the most likely outcome.

Stay tactically long USD, slightly bearish equities.

Expect core global yields to range trade, possibly with a slight upside bias in the US.

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