Oil prices neared nine-month highs late last week, touching
Investors will be watching a range of data, from German and Japanese consumer prices to first-quarter US GDP, to see how the Federal Reserve, the
"Just as oil prices had become increasingly stable, we reckon the risk for an oil price spike is now the highest since the global crisis," said
"We think a further price spike of 10 to 15 percent from here is not implausible," he said.
Until now, falling energy prices have partly been responsible for the euro zone's low level of consumer price inflation, which the ECB considers to be in its "danger zone".
A rise in the inflation rate would be welcome but economists and the
Euro-zone sentiment readings and preliminary purchasing managers' surveys for June today may give the ECB a sense of how much more help the euro-zone economy needs. The recovery from a two-year recession lost pace in April and manufacturing has lost momentum.
"Although higher near-term inflation may reduce the likelihood of more ECB easing in the short term, lower economic growth and core inflation down the line would, in fact, support the case for further policy accommodation at a later date,"
In the US, investors will be looking to final reading of US first-quarter GDP figures on Wednesday to see if there is a revision of the 1 percent contraction already printed and |which followed disappointing March trade figures. Federal Reserve chief
Core US consumer prices have risen 2 percent over the last year. If the inflation rate went much higher, it would put pressure on the Fed to consider moving to raise rates.
For now though, the impact of events in
Yellen said interest rates could stay "well below longer-run normal values at the end of 2016".
A speech by
"Following last week's Fed meeting and amid renewed concern over inflation, US news flow might actually be rather sobering,"
There is also talk of additional stimulus in
Among other big industrialised powers, first-quarter British GDP |on Friday will show a different picture.
Economists expect growth to be revised up to 0.8 percent due to a better showing from construction.
That would bring annual growth |to 3.1 percent, the strongest since before the start of the global financial crisis.
The Bank of
"Markets now more or less fully price in a 25 basis point rate hike by year-end, consistent with our view,"
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