What to Expect this Week

This week, in the United States, we expect Chairman Ben Bernanke to reaffirm the Federal Reserve policy to keep the benchmark interest rate unchanged since the labor market is still weak as show by last's week payrolls data. Still, retail sales are likely to show some gains in May due to an improvement in consumer's confidence. Also, the trade deficit may widen in April with imports rising and exports unchanged.

In the Euro Area, the European Central Bank is expected to leave interest rate at 1%. Yet, the market is looking for the announcement of a new long term refinancing operation. In Japan, last week Naoto Kan became new prime minister. The new administration is likely to support a weaker yen and implement new measures to reduce huge public debt. Also, the first quarter GDP may be revised slightly down as public investments felt more than previously thought. In the United Kingdom, the Bank of England is expected to keep its current monetary unchanged. In addition, trade deficit may shrink as exports probably recovered and retail sales are expected to rise further. In Australia, employment growth is likely to slow down in May due to higher interest rates and risk aversion which is hitting the price of Australia's main commodities. In New Zealand, the economic outlook has improved recently and the Reserve Bank  is expected to increase its official cash rate. Finally, China's inflation rate probably increased in May and trade surplus widened further.

6/6/2010 1:29:27 PM