US Inflation Starting to Stir as Trump Tariff Threat Looms

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In Canada, Prime Minister Mark Carney is set to unveil a new cabinet tasked with an ambitious economic agenda, including removing internal trade barriers and reorienting exports away from the US. Home sales for April will offer insight into a spring slump, while Ontario, the country’s most populous province, releases its budget.

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Elsewhere, gross domestic product reports from Japan to the UK and Switzerland, inflation data in India, multiple speeches by central bankers, and a likely interest-rate cut in Mexico are among the highlights.

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Click here for what happened in the past week, and below is our wrap of what’s coming up in the global economy.

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Asia

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Days after the US-China trade talks in Geneva, trade ministers from APEC gather in South Korea Thursday and Friday to hash out a strategy for sustaining what amounts to roughly 49% of global commerce.

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A focus will be on ensuring the viability of regional supply chains and any hints on what US measures might replace the so-called AI diffusion rule.

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India on Thursday will report April trade figures that may highlight the importance of its proposal to secure a deal with the US for zero tariffs on steel, auto components and pharmaceuticals. Indonesia releases its own trade accounts on Thursday. 

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In other data, India’s consumer inflation is seen having cooled in April to 3.2% year on year, the slowest pace since July 2019, giving the Reserve Bank of India scope to cut rates again when it next sets policy on June 6. 

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Preliminary data on Friday is likely to show Japan’s economy slipped into contraction during January-March for the first time in a year. Business investment is seen slowing, while private consumption is expected to stall. 

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Australia on Tuesday gets gauges for April business sentiment and May consumer confidence, with first-quarter wage price index due a day later. Finally, unemployment for April is due on Thursday.

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Europe, Middle East, Africa

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UK data will shed light on an economy whose clouded outlook kept the Bank of England cautious at its decision on Thursday. The BOE cut rates by a quarter point after a three-way vote split between officials, with a minority wanting either a bigger reduction or none at all. 

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On Tuesday, UK wage numbers will probably show weakening pay pressures at a time when inflation remains noticeably above the 2% target. Thursday’s GDP report may reveal a growth spurt in the first quarter before Trump’s trade war hit.

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Eight of the nine members of the BOE’s Monetary Policy Committee are scheduled to speak during the week, including Governor Andrew Bailey. Appearances by at least 10 European Central Bank officials are also on the calendar. 

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Aside from Germany’s ZEW investor sentiment survey on Tuesday and eurozone industrial production on Friday, most data releases in the region are second estimates of growth or inflation. One highlight will be the European Commission’s spring economic forecasts at the end of the week. 

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Switzerland and Norway release first-quarter GDP figures on Thursday. Swiss National Bank President Martin Schlegel will speak in Lucerne the following day, just as zero inflation and a strong franc put the spotlight on his next policy move.

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Israel’s central bank on Thursday will watch to see if inflation slowed in April from a prior reading of 3.3%. It remains above the target of 1% to 3%, with the expanding war in Gaza complicating efforts to lower it.

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On Friday, Russian officials will look for signs that inflation, currently above 10%, may have weakened in April. After holding the key rate at a record high last month, Bank of Russia Governor Elvira Nabiullina said that price growth will probably peak in May.