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Will inflation fears flare up again on Friday?


Inflation is rearing its ugly head again so there will be keen interest on Friday and the US core personal consumption expenditures (PCE) index for May.

The numbers could give a clue to future Federal Reserve policy on “tapering” – the gradual reduction of quantitative easing.

“If this shows accelerating prices then this will only boost tapering speculation further, now that the Fed has started talking about talking about [sic] tapering. If so, it could provide the dollar with renewed strength and may be bad news for stocks,” suggested Fawad Razaqzada at Think Markets/

The market is expecting a 0.6% month-on-month increase.

US personal income, which fell 13.1% in April, is expected to have fallen 2.5% in May, which is progress of sorts, I suppose.

In the UK, the GfK consumer confidence survey for June is expected to show an improvement in the balance number to -7 from -9 in May.

At 11.00am, the CBI distributive trades survey is set to release reported sales from its survey respondents for the month of May.

Significant announcements expected

Finals: Jade Road Investments Ltd (LON:JADE)

Economic data: UK consumer confidence, US personal incomes

FTSE 100 ahead as Bank of England maintains bond buying, while Wall Street set for positive start

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