Danske Daily – 13 July 2017

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Today focus will be on inflation with the Swedish print for June being a very uncertain story. There are several sources of uncertainty, which, in our view, basically are just a lot of noise. However, we have a forecast of 0.2 percentage points under the Riksbank’s new CPIF (DB 1.5%, RB 1.7%) and CPIF excluding energy projections. Our forecasts are in the lower end of the range, with consensus being in line with the Riksbank. Hence, if we are right, rates could go a little lower and EUR/SEK bounce higher, maybe towards 9.70. Negative contributions from clothing and food, whereas recreation and transportation will add to inflation, we think.

The German, French and Spanish HICP inflation figures are the final versions and should all be unchanged from the flash estimates already released. In the US, PPI inflation is expected to be down by 0.6 percentage points, but PPI core inflation should only be 0.1 percentage points lower than in May.

Comments from Fed members will also remain in focus with Chair Janet Yellen’s semi-annual testimony continuing in the Senate followed by speeches from Evans and Brainard.

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