This week starts quietly, with no significant scheduled economic events for the FX market on Monday.
On Tuesday, Australia will release the Westpac consumer sentiment index. Inflation data will be the main highlight in the U.S., together with the ADP employment and new home sales figures.
Wednesday will also bring several key U.S. releases, including PPI m/m, retail sales m/m, and existing home sales.
The U.K. will publish its GDP m/m figures Thursday, while the U.S. will release data on unemployment claims, the Empire State manufacturing index and the Philly Fed manufacturing index.
The week will conclude with the U.S. industrial production m/m print on Friday.
Several FOMC members are expected to deliver remarks throughout the week.
In the U.S., the consensus for core CPI is 0.3% m/m compared to 0.2% prior, while headline CPI is expected to rise 0.3% m/m, unchanged from the prior month. The year-over-year CPI rate is forecast to remain steady at 2.7%.
Some analysts note that November inflation data were disrupted by the government shutdown, and this week’s release is expected to show firmer monthly gains as data collection normalizes. Despite this, annual inflation is still likely to trend lower overall.
Core goods prices may face some upside pressure, largely because an unusually high share of holiday discounting was likely captured in the November data. At the same time, shelter inflation is expected to move back in line with its pre-shutdown pattern, with a meaningful pickup unlikely until spring, according to Wells Fargo analysts.
October new home sales in the U.S. are forecast at 715K, with the September figures also scheduled for release at the same time. August data showed an unusually sharp rise in sales, driven largely by strength in the South, although the size of the increase is difficult to reconcile with mortgage rates that were still above 6%.
While builders have been using incentives such as price reductions and mortgage rate buy-downs to offset affordability pressures, the growing reliance on these measures highlights ongoing demand challenges. As a result, analysts expect new home sales to have eased in October, falling back toward levels more consistent with the pace seen earlier in the summer.
The consensus for retail sales m/m is 0.4% vs. 0.0% previously, while core retail sales m/m are also expected at 0.4% compared to 0.4% prior. The rebound is likely to be driven by a pickup in auto sales, which fell sharply in the previous month, while sales excluding autos are expected to rise by around 0.3%.
Consumer spending has held up well over the past year, and high-frequency data suggest this resilience continued into November. However, the core measure of retail activity, which excludes autos, gasoline, food services, and building materials, is likely to have moderated following a strong gain in October.
Affordability pressures and a cooling labor market remain key headwinds, although holiday spending is still expected to have met forecasts of roughly 3.5–4.0% y/y growth. Looking ahead, middle- to upper-middle-income households may see some relief from higher after-tax income and larger tax refunds, which could provide a modest boost to discretionary spending in early 2026, according to analysts at Wells Fargo.
In the U.K., the consensus for GDP m/m is 0.0% compared with -0.1% previously. A modest improvement is expected in this week’s data, driven by a mild pickup in services activity. Industrial output is likely to be flat following a solid gain in October that was supported by a recovery in auto production.
The broader outlook remains unconvincing as momentum is expected to slow down. Business surveys suggest the economy has largely lost steam, with renewed weakness in services and only modest improvement in manufacturing.
That said, analysts note this may reflect a recurring pattern in which growth appears stronger in the first half of the year than later on, raising the possibility that some of the late-year softness is due to seasonal adjustment issues rather than a clear deterioration in underlying economic conditions.
From a monetary policy perspective, the Bank of England is expected to continue cutting rates as inflation shows further signs of cooling and economic activity remains soft.
This article was written by Gina Constantin at investinglive.com.