Asia shares inch higher before inflation tests
data which culminates in a key U.S. inflation report that could set the stage for a cut in interest rates there, albeit not for a few months yet.
Holidays in the United States and UK made for thin trading ahead of Friday's figures on core personal consumption expenditures (PCE), the Federal Reserve's preferred measure of inflation. Median forecasts are for a rise of 0.3% in April, keeping the annual pace at 2.8%, with risks on the downside.
«Consumer and producer price data suggest core PCE inflation lost further momentum in April after a strong start to the year. Indeed, we look for the core index to advance 0.22% m/m vs 0.32% in March and an initial 0.25% estimate,» said analysts at TD Securities in a note.
«We also look for the headline to rise 0.23% m/m while the super core likely cooled to 0.26%.»
Figures for inflation in the euro zone are also due on Friday and an expected tick up to 2.5% should not stop the European Central Bank from easing policy next week.
Policy makers Piero Cipollone and Fabio Panetta both flagged a coming cut over the weekend, while markets imply an 88% chance of an easing to 3.75% on June 6.
The Bank of Canada might also ease next week, while the Fed is seen waiting until September for its first move.
There are at least eight Fed officials due to speak this week, including two appearances by the influential head of the New York Fed John Williams.
The head and deputy head of the Bank of Japan speak later on Monday, along with the ECB's chief economist. The BOJ holds its policy
