In the upcoming week, several key stories are set to unfold in the realm of business and finance. In the US, inflation data is set to be released on Friday, providing valuable insight into the Federal Reserve’s potential interest rate decisions. The personal consumption expenditures price index will be closely monitored, especially after recent data showed consumer prices rising less than expected. While investors hope for rate cuts, the Fed has indicated that it may wait until inflation reaches its 2% target before making any moves.
Meanwhile in Europe, the European Central Bank is expected to cut its deposit rate from a record high of 4% in June. However, uncertainty remains about the extent and speed of further rate cuts, especially if inflation data released on Friday shows ongoing price volatility. Economists anticipate euro zone inflation to have increased to 2.5% year-on-year in May, up from 2.4% in April.
In South Africa, an uncertain election is looming for the ruling African National Congress party. Polls suggest the ANC may lose its parliamentary majority for the first time since the end of apartheid when voters head to the polls on Wednesday. The party may need a coalition partner to govern, with potential implications for the economy and financial markets. If they align with business-friendly Democratic Alliance party there could be smoother outcome but if they align with far-left Marxist Economic Freedom Fighters led by ex-President Jacob Zuma there could be more drama
