Tuesday preview: US inflation report in focus amid tariff uncertainty

(Sharecast News) - Economic data is set to steal the show on Tuesday as no major earnings are due from London-listed blue chips, with figures on UK unemployment, German investor confidence and US inflation scheduled for release during the trading session. The US inflation report will be the market-moving event of the day and comes at a time when economists are still attempting to calculate the impact of Donald Trump's fluctuating trade policies on consumer prices.

According to consensus estimates, the CPI index is expected to have risen by 0.3% in April after a 0.1% decline in March, though the year-on-year rate is tipped to have held steady. The key figure for core inflation, meanwhile, is estimated to be unchanged at 2.8%.

"Although headline inflation is expected remain steady, this will still be a litmus test for the inflationary impact of US tariffs," said Kathleen Brooks, research director at XTB, though she stressed that April's prices likely won't truly reflect the impact of tariffs due to lag effects.

"Ironically, prices could surprise on the downside, even with tariff risks, as businesses tried to entice consumers to buy products or go out and spend money, in a tough environment," she said.

Whatever the outcome on Tuesday, investors will likely still be reacting to this weekend's trade talks between China and the US, where the two nations agreed to cut levies for the next 90 days. Washington will reduce tariffs on Chinese goods to 30% from 145%, while Beijing will lower duties to 10% from 125%.

"Tariffs at 30% on Chinese goods are better than tariffs at 145%, but 30% is still a hefty sum, which could hit the consumer and the inflation rate down the line," Brooks said.

In the UK, the focus will be on employment figures for March. Growth in average earnings including bonuses is expected to have slowed from a quarterly annual pace of 5.6% to 5.2%.The rate of unemployment is forecast to have ticked higher by a tenth of a percentage point to 4.5%.

In Germany, the closely followed ZEW survey measuring confidence among analysts and institutional investors is expected to show that the economic sentiment index improved to 13.7 in May from -14 in April.

Tuesday 13 May

INTERIMS

On The Beach Group , Renew Holdings, Treatt

INTERIM DIVIDEND PAYMENT DATE

VinaCapital Vietnam Opportunity Fund Ltd.

INTERNATIONAL ECONOMIC ANNOUNCEMENTS

Consumer Price Index (US) (13:30)

Current Account (GER) (13:30)

ZEW Survey (EU) - Economic Sentiment (10:00)

ZEW Survey (GER) - Current Situation (10:00)

ZEW Survey (GER) - Economic Sentiment (10:00)

FINALS

Angling Direct , Bytes Technology Group , Diaceutics , IQE

AGMS

Baronsmead Venture Trust, Fisher (James) & Sons, Henderson High Income Trust, HUTCHMED (China) Limited, ITV, Macfarlane Group, Midwich Group, Phoenix Group Holdings , Serinus Energy NPV, St James's Place

UK ECONOMIC ANNOUNCEMENTS

BRC Sales Monitor (00:01)

Claimant Count Rate (07:00)

Unemployment Rate (07:00)

FINAL DIVIDEND PAYMENT DATE

Abrdn , Fidelity European Trust, Morgan Advanced Materials , OSB Group , Rathbones Group

Q1

Telecom Egypt SAE GDS (Regs)