It is a very light day for new economic data with no releases of note. The G7 finance ministers and central bankers begin a three day meeting today but little concrete is expected. Some of the concerns about global deflation prevalent a few months ago have started to dissipate but participants are still likely to discuss what further can be done to stimulate global economic growth. The potential impact of a US interest rate rise later this year is also likely to be discussed and officials from other countries will no doubt be asking their euro area counterparts for an update on the Greece negotiations.
Domestically the state opening of parliament will see the new government’s legislative programme outlined in the Queen’s speech. Prominent within this will be legislation to allow the calling of a referendum on EU membership. The government will likely want to have the legislation in place to give it the option to call this in 2016. However, it is very unlikely that a specific date will be talked about at this point. Today’s Bank of Canada policy meeting is unlikely to lead to any policy change. The recent rebound in the oil price may have alleviated some of the downside concerns about economic growth that caused the BoC to make a precautionary interest rate cut earlier this year. However, it will likely be regarded as premature to completely rule out the possibility of any further easing, says Lloyds Bank.
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