THE European Union’s rescue plan for Greece is expected to continue to take centre stage this week as traders look for greater clarity from policymakers. The Eurogroup – a committee of the finance ministers of the eurozone – meets today and we may see some market-moving announcements later on. With the US markets closed for Presidents’ Day, the only other release of note on Monday is the Rightmove house prices for February, which showed asking prices jump 3.2 per cent.
British hawks will be watching the January inflation data out on Tuesday, which is expected to jump beyond three per cent as the full effect of the VAT hike and sterling’s depreciation feeds through.
This will require a letter of explanation from the governor of the Bank of England to chancellor Alistair Darling.
BANK QE DEBATE
The Bank of England chose to pause its £200bn quantitative easing at the start of the month but there is speculation that the decision was not unanimous.
Minutes, which will be released on Wednesday will show which members, if any, dissented from the majority vote.
Also out on Wednesday is UK unemployment data and a stabilisation of the unemployment rate at 7.8 per cent is forecast.
Two weeks ago the Institute for Fiscal Studies estimated that public sector net borrowing in 2009-10 would be less than the Treasury had forecast.
Public finances data for January may go some way towards vindicating the Institute for Fiscal Studies prediction.
EUROPE AND THE US
In a short week for the US, we’ll see last month’s industrial production figures on Wednesday at 2.15pm UK time and consumer prices figures will be published on Friday at 1.30pm.
Besides the Eurogroup meeting on Monday, the European Central Bank governing council is convening on Thursday.
Purchasing Managers' Index data for the 16-country currency union is out on Friday.