Week Ahead for FX, Bonds: U.S. Inflation Data in -2-

Australia and Thailand are highlighted for upcoming inflation and rate decisions after the week’s earlier focus on U.S. data. Australia will release May consumer-price data on Wednesday, with economists expecting the headline CPI to fall 0.1% month over month. Attention is expected to center on underlying inflation pressures linked to elevated oil prices, with ANZ forecasting trimmed mean inflation rising 0.3% in the month and lifting annual underlying inflation to 3.5%. ANZ notes upside risks, including expected increases in food, housing, and alcohol prices. Reserve Bank of Australia Governor Michele Bullock said in June that rate hikes had paused to judge whether further action is needed, with unemployment rising to 4.5% in April from 4.3%. Thailand’s May inflation is expected to support the Bank of Thailand holding rates steady on Wednesday, even as ANZ warns oil-related pressures could push inflation above the upper target later.