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Although this week will be slightly quieter than last, RBA, BOE and FOMC Meeting Minutes promise to take the economic centre stage.

The RBA Meeting Minutes will be the first high volatility event of the week, 02:30 BST on Tuesday 20^th. Australian Interest Rates currently stand at 7.25% with no speculation of any immanent cuts.

Both the BOE Monetary Policy Committee and the Federal Open Market Committee Meeting Minutes will be released this Wednesday, May 21^st. The BOE will come first, at 09:30 London time with the Fed following at 19:00 BST. As you might expect, these events will draw heavy interest from traders and economists with high market volatility expected. The markets are firmly focused on whether either central bank sees the need for further near term interest rate cuts.

Specifically, traders will watch the MPC Member vote split from the last meeting. The decision was taken to keep the rate on hold at 5.00% and the weight of the majority decision will be watched very closely for clues to the pace and direction of future rate moves.

While the FOMC does not reveal any vote casting it does publish a detailed summary of the interest rate meeting. Traders will closely scrutinize this commentary for clues to future rate moves. At present the popular market opinion is that the US will leave rates on hold in the near term.

Prior to the data landing on Wednesday we will see US PPI and Core PPI. They will hit the wire on Tuesday at 13:30 London time, 08:30 EST. The raw Producer Price Index carries more weight than the Core release. Economists are expecting 0.4% MoM for the PPI and 0.2% for the Core reading.

Later in the week we will see more high-volatility events from the US and UK. On Friday we will see the UK GDP Second Estimate which is expected to come in unchanged at 0.4%. This will be followed at 15:00 BST by US Existing Home Sales. Following a modest but unexpected increase to 5.03 million units in the March announcement, economists are expecting a second straight monthly decline to 4.86 million.

Further high volatility events this week are as follows:

BOJ Press Conference following the BOJ Interest Announcement - Tuesday am
Swiss PPI MoM - Tuesday 08:15
German ZEW Economic Sentimant - Tuesday 10:00
German Ifo Business Climate Index - Wednesday 09:00
Canadian Core CPI - Wednesday 12:00
UK Retail Sales - Thursday 09:30
Canadian Core Retail Sales - Thursday 13:30

The trading week is slightly shorter than normal in Canada (Victoria Day, Monday 19^th) and Germany (Corpus Christi, Thursday 22^nd) with lighter volume and volatility expected during these trading sessions. For more info please see our 2008 market holiday calendar.

The Passion-Trading visual analysis and historical data tool will support the following releases this week:

US PPI MoM
BOE MPC Meeting Minutes
Canadian Core CPI MoM
US Existing Home Sales

For details on the scheduled economic speeches you can check out this week’s economic comment calendar.

The GBPUSD currency pair promises to be in focus this week as the UK and US both have busy economic release schedules

On Monday we will see PPI Input and Trade Balance data from the UK at 09:30. Both of these releases are regarded with maximum importance. Economists are expecting PPI Input to come in at 1.8% MoM. The index is important because it assumes that the manufacturing sector will look to pass on increasing costs to the consumer. Elevated Producer Inflation has been caused by an increase in fuel and commodity prices and the impact of a softening Pound. PPI Output is also set to be released at the same time although this is slightly less important to the market.

The UK Trade Balance, released by The Office for National Statistics, is expected to narrow slightly to -7.5 billion pounds from an expected revision of -£7.6 bln in February.

This Tuesday (13^th) will be equally as busy. Just after midnight UK time, the RICS House Price Balance will be released. Economists are expecting 80% of mortgage surveyors polled to report house prices falling in their area from the 78.5% last month.

At 09:30 the highly anticipated UK Consumer Price Index will be released. Traders will be most interested in the CPI YoY because it is the benchmark reading that the BOE uses in its monetary policy considerations. The CPI is expected to increase to 2.6% from a previous reading of 2.5%. Core CPI is also expected to increase from 1.2% to 1.3%

After a quiet Monday, the first high volatility news from the US will be released on Tuesday. The action starts at 13:20 with Fed Chairman Bernanke’s speech at the Atlanta Fed’s Financial Markets Conference. Then, at 13:30 (08:30 EDT) Retail Sales and Core Retail Sales are due. Retail sales are expected to decrease MoM by -0.2%, however the core number is set to rise by 0.2%.

Later in the week we will see the further action from the UK and US with BOE Quarterly Inflation Report (Wednesday @10:30), US Core CPI MoM (Wednesday @ 13:30), Empire State Business (Manufacturing) Conditions Index (Thursday, 13:30), TIC Net Long-Term Transactions (Thursday, 14:00), Fed Chairman Bernanke speaking at the Chicago Fed’s annual convention (Thursday, 14:30), Philadelphia Fed’s Manufacturing Index (Thursday, 15:00) and finally Michigan Consumer Sentiment at 14:55 on Friday.

Outside of the US and UK this week the following high volatility events are scheduled:

NZD – Retail Sales MoM, Wednesday @ 23:45
NZD – PPI Input MoM, Thursday @ 23:45
JPY – Preliminary GDP QoQ, Friday @ 00:50

Economic Speeches and Comments

As usual there are a number of key comment and events to be aware of, especially from the US. The Atlanta Fed’s Financial Markets Conference dominates the first part of the week with no less than 3 Federal Reserve officials speaking on Tuesday. The market will focus on Bernanke’s comments at 13:20 with Warsh and Plosser participating in discussions later in the day.

Bernanke is also due to speak at the Chicago Fed’s Annual Conference on Bank Structure and Competition on Thursday, 14:30. This is also a high profile event as Bernanke’s comments focus on “Risk Management at Banking Organizations”.

Full details can be found at this week’s speech and comment calendar.

Also this week, the visual analysis and historical data tool is available for Core US CPI.

The following new terms have been added to the financial terms dictionary:

Challenger Job Cuts Report

BOE Financial Stability Report

GDP Advance

GDP Advance Price Index

CPI Flash Estimate