DAVY VIEW

A busy week ahead sees central bank meetings take centre stage. We think an increase in euro area rates this year is more likely than for the Bank of England, where pay growth has slowed sharply since last year. We also preview April’s flash inflation reading, with an annual increase of 3.6% likely, although upside risk to this could see inflation up towards 4%. We have long expected a strong increase in new dwelling completions in Q1, although downside risks include bad February weather conditions.