Inflation rate to soften, but remain challenging
Inflation data will be published on Wednesday and though prices continue to rise there are signs of the rate slowing.
Capital Economics is forecasting a drop in core inflation to 7%, which would help to bring overall inflation down to 8.2%.
Despite calls from the Prime Minister and Chancellor for wage restraint to control price rises, economists are now also saying that even the latest public sector pay awards should not push up inflation.
AJ Bell financial analyst Danni Hewson says the good news is that it looks like the rate peaked at 11.1% last October. The bad news, she says, is that prices are still rising quickly, even if the rate is decelerating.
“Economists, politicians and central bankers will be praying for deceleration this time around, especially as markets are now pricing in a peak in the Bank of England base rate of 6.5% by February 2024, as the Monetary Policy Committee tries to rein in inflation, having been initially slow to react,” says Hewson.
The main trading updates come at the end of the week, with power company SSE, construction company Kier and airline easyJet reporting on Thursday, while high street retailer Frasers reports full year results on Friday when there are also official retail figures.
Online grocer Ocado announces first half figures on Thursday and analysts will be looking for signs of combating a slowdown in the delivery model.
The company is not forecast by analysts to make a profit until 2026 at the earliest and its shares are down by a third over the past year and by four-fifths from their early 2021 all-time high, when the pandemic and lockdowns had markets convinced that online delivery was the only game in town. However, the growth rates generated then have proved hard to sustain.
Monday 17 July
- Trading statements from Rio Tinto and DFS Furniture
- Rightmove UK house price index
- Chinese monthly growth figures for retail sales and industrial production
Tuesday 18 July
- US retail sales
- US industrial production figures
Wednesday 19 July
- Trading statements from Antofagasta, Severn Trent and Finsbury Food
- UK consumer price inflation (CPI) figures
Thursday 20 July
- First-half results from Howden Joinery
- Trading statements from SSE, 3i, Anglo American, QinetiQ, Kier, Dunelm, Diploma and easyJet
- UK Government borrowing figures
Friday 21 July
- Full-year results from Frasers, Yellow Cake, Fulham Shore and Naked Wines
- First-half results from Moneysupermarket.com
- Trading statement from Glencore
- GfK UK consumer confidence survey
- UK retail sales