Sweden: Trade war risk is increasing
|Market Movers ahead
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The next scheduled date for the trade disputes is 30 June, where the US government is set to announce plans for restricting Chinese investments.
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The European Council meeting on 28-29 June will be important for whether the German government crisis is resolved, what line the new Italian government takes and possibly for the Brexit process.
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We expect the June inflation number for the euro area to be 2%, up from 1.9%, but it is likely to decline again later this year.
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The most important US inflation measure is likely to have increased in May.
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Swedish data is likely to show another trade deficit in May.
Global macro and market themes
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A further escalation in trade tensions has become our baseline scenario ahead of 6 July.
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The escalation will weigh on global economic growth.
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Equity volatility will be high, with downside risks for equities near term.
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Industrial and agricultural commodities are primarily at risk.
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The prospects of a stronger USD, lower commodity prices and weaker global growth weigh on emerging markets.
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