Yesterday's session brought UK CPI and PPI figures. The Consumer Prices Index (CPI) rose by 0.3% in the year to January 2016, in line with market forecasts, compared with a 0.2% rise in the year to December 2015. This is the third consecutive month of small increases, with the rate in January 2016 being the same as it was in January 2015. The main contributors to the rise in the rate were motor fuels, and to a lesser extent food, alcoholic beverages and clothing. Air fare prices partially offset the rise in the rate, falling by more than they did a year ago. This followed a large increase in prices in December 2015.
The price of goods bought and sold by UK manufacturers, as estimated by the producer price index, continued to fall in the year to January 2016. This month shows the smallest decreases in both the output and input prices for the last 13 months.
Factory gate prices (output prices) for goods produced by UK manufacturers fell 1.0% in the year to January 2016, compared with a fall of 1.4% in the year to December 2015. Core factory gate prices, which exclude the more volatile food, beverage, tobacco and petroleum products, showed no movement in the year to January 2016, compared with an increase of 0.1% in the year to December 2015.
In the US session Empire State Manufacturing Index data was published. The February 2016 Empire State Manufacturing Survey indicates that business activity continued to decline for New York manufacturers. The headline general business conditions index edged up three points, but remained firmly in negative territory at -16.6. Analysts were anticipating increase to -10.3. The new orders and shipments indexes indicated an ongoing decline in both orders and shipments.
From the UK, tomorrow, job figures will be published. Number of unemployed is predicted to fall by 2,900, while unemployment rate should decrease to 5.0%. In the US session Building Permits, Housing Starts, PPI and Industrial Production data will be published, as well as FOMC Meeting Minutes. Building Permits and Housing Starts should remain relatively unchanged, PPI is expected to decline by 0.2%. On the other hand, analysts forecast 0.3% increase in Industrial Production. FOMC Meeting Minutes should add additional volatility by the end of the session.
Figures to watch:
Claimant Count Change/Unemployment Rate (Wednesday 10:30)
Building Permits/Housing Starts (Wednesday 14:30)
PPI (Wednesday 14:30)
Industrial Production (Wednesday 15:15)
FOMC Meeting Minutes (Wednesday 20:00)
