Danske Research Team
Danske Bank A/S
Market movers ahead
Negotiations between Greece and three creditor countries progress slowly but deadline for avoiding default now appears to be extended until mid-June.
We expect no new signals on policy in connection with the ECB meeting. Focus will be on ECB’s plans to frontload bond purchases to avoid a seasonal squeeze.
In the euro area we expect inflation to have increased to 0.1% y/y in May but there are upside risks after Italy and Spain have reported higher-than-expected inflation.
In the US we expect non-farm payrolls to have increased 220,000 in May. In our view this is still strong enough to pave the way for a Fed-hike in September.
In Denmark the foreign reserve data for May will show to what degree the Danish central bank has continued its purchases of DKK in May.
Global macro and market themes
The Fed is close to ticking all the boxes for lift-off.
In the three months up to the first hike US bond yields tend to rise, the USD strengthens and stocks rise moderately.
We look for a repeat of this pattern.
Euro-area data confirm short-term softness but strong medium-term outlook.
US housing picks up steam.
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