This upcoming week, there are several key stories in business and finance to keep an eye on. In the U.S., the release of inflation data on Friday will provide insight into the Federal Reserve’s stance on interest rates. Despite recent reports of lower than expected consumer prices, the Fed has signaled it may wait a few months before considering rate cuts to ensure inflation reaches its 2% target.
In Europe, the European Central Bank is expected to cut its deposit rate in June, but the extent of this cut remains uncertain. The upcoming monthly inflation data will play a crucial role in determining the pace of this rate cut, with economists predicting an increase to 2.5% for May. This data will be closely watched to assess the stability of price pressures in the euro zone.
In South Africa, an uncertain election on Wednesday could see the ruling African National Congress party lose its parliamentary majority for the first time post-apartheid. If the ANC requires a coalition partner to govern, the outcome could impact the country’s assets and currency. A possible partnership with the business-friendly Democratic Alliance may result in a stable response from the markets, but a collaboration with the far-left Marxist Economic Freedom Fighters could introduce more volatility. The results of this election will be closely monitored for its implications on the country’s political and economic future.