UK inflation figures and updates from Royal Mail and earnings from Tesla are the big themes for Wednesday.
A month ago the consumer price index rose to another record high of 9.1%, although core prices, which exclude fuel and food, slipped back to 5.9%.
Despite the slide in core prices, every other measure including retail and producer price inflation showed little sign of a slowing, with PPI input prices jumping above 20%, and increasing to a new record of 22.1%.
The long-running RPI measure rose to a 40-year high of 11.7%.
For June, the CPI headline number is expected to increase to 9.3% and then keep rising to “slightly above 11% in October”, according to the Bank of England, whose monetary policy committee pledged at its most recent meeting to act “forcefully” on inflation if necessary.
“This rather begs the question as to what level of inflation would justify a more forceful response when the US central bank is set to raise rates by another 150bps by September in response to a lower inflation problem,” said market analyst Michael Hewson at CMC Markets.
“A lot of the increase in headline CPI is now starting to manifest itself in higher gas, electricity prices, and petrol prices, which accounted for over 4% of the increase in May and looks set to continue in June.”
Investors are expecting to hear from Royal Mail PLC (LSE:RMG) that its Covid bounce is well and truly over while later in the evening London time, Elon Musk’s electric vehicle powerhouse Tesla will report second-quarter earnings.
This follows hot on the heels of a production and delivery update that saw volumes fell compared to the previous quarter for the first time in 10, though June was the highest production month in Tesla’s history.