Market Movers ahead
In contrast with the consensus expectation and market pricing, we think the Federal Reserve will keep rates on hold when it meets on Wednesday and instead make an announcement on balance sheet reduction.
We expect US CPI inflation was 2.0% y/y in May down from 2.2% y/y in April.
In the UK, the market will focus on the ramifications of the election results.Also the Bank of England will meet on Thursday.
In Denmark and Sweden, attention will be on the release of CPI inflation data for May.
The regional network report from Norway should paint a benign picture of the economy.
Global macro and market themes
Markets are increasingly diverging with stocks keeping an upbeat tone while bond yields, commodity markets and inflation markets have moved lower.
We see a rising discrepancy between the strong equity markets and disappointing data recently.
We still recommend a more cautious stance on stocks in the short and medium term.
Bund yields are set to stay in range.
EUR/USD lower short term - higher medium term.
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