Market Outlook for the Week of July 20-24

Monday begins with Marine Day in Japan, shifting focus later to Canadian inflation data. On Tuesday, New Zealand will release its CPI data, while the U.K. will publish claimant count change, average earnings index, and unemployment rate. Wednesday will highlight the U.K.'s inflation report. On Thursday, Australia will release employment change and unemployment rate, while the Eurozone will focus on the ECB monetary policy announcement. Friday will see Japan's national core CPI and flash manufacturing and services PMI releases from the U.K., Eurozone, and U.S., alongside U.S. new home sales data.

In Canada, the consensus for CPI m/m is -0.2%, down from 1.0%. Median CPI y/y is expected to remain at 2.1%, while common CPI y/y is forecast to ease to 2.5% from 2.7%. Analysts suggest that Canada's inflation is expected to cool, largely due to lower energy costs, although food inflation remains elevated. The Bank of Canada will monitor data closely to assess inflationary pressures.

In New Zealand, CPI q/q is expected at 1.5%, up from 0.9%, with annual CPI projected to rise to 4.1% from 3.1%. The increase is driven by higher energy prices, though core inflation remains above the RBNZ's target.

The U.K. will release inflation and labor market data, with headline CPI y/y expected to ease to 2.7% from 2.8%. The claimant count change is forecast at 28.3K, with the unemployment rate expected to remain at 4.9%.

Australia's employment change consensus is 15.2K, down from 40.3K, with the unemployment rate expected to hold at 4.4%. The labor market has shown signs of softening, with underemployment rising amid cost-of-living pressures.

The ECB is anticipated to keep its deposit rate unchanged at 2.25%, focusing on inflation amid uneven economic growth in the Eurozone. In Japan, national core CPI y/y is expected to rise to 1.6%. The BoJ will assess underlying price pressures to determine future policy direction.

In the U.S., new home sales are expected to reach 604K, recovering from previous declines, although higher mortgage rates continue to weigh on housing demand. Analysts expect a modest improvement in the housing market later this year.