First Act: U.S. CPI Bears Watching

Tuesday’s June CPI report anchors the agenda. Forecasts point to a 0.3 % core monthly rise and a 2.9 % annual pace—a hair south of May but still sticky. A cooler-than-expected number would reignite talk of a September Fed cut and knock the greenback; a hotter reading would harden “no-cuts-in-2025” bets, lift two-year yields, and pressure risk assets. 

Sterling’s Starter: Better BRC Numbers

The U.K. arrives with a firmer footing after the BRC Retail Sales Monitor beat estimates at 0.6 %. That momentum could vanish if Wednesday’s CPI undershoots, but for now it offers a modest shield against dollar strength.

Mid-Week Pivot: Inflation Pair-Trade

• Britain’s CPI: Consensus has headline inflation unchanged at 3.4 %. A print above 3.5 % would cement the view that Bank Rate stays elevated, handing GBP bulls fresh ammo. A miss, however, leaves sterling vulnerable to a retest of June’s 1.3370 trough. 
• U.S. PPI: Even a modest upside surprise could reinforce CPI’s signal or offset any downside wobble, making Wednesday afternoon a key inflection for EUR/USD and GBP/USD.

Euro Check-In: Thursday Price Pulse

Although the euro zone’s flash CPI held at 2 %, traders will want confirmation. Stubborn service-sector inflation could delay the ECB’s next cut; a dip toward 1.8 % would boost doves and weigh on EUR crosses.

Consumer Watch: Retail Sales Test

U.S. consumers go under the microscope Thursday. Street estimates call for a 0.9 % drop in retail volumes, the worst since January. Combined with slightly higher jobless claims, that would stoke fears of tariff-induced spending fatigue and clip the dollar. Positive surprises could flip the narrative and rescue a bruised greenback.

Friday Finale: Japan’s CPI & U.S. Confidence

• Japan: Headline inflation is seen edging up to 3.5 %. Anything hotter could jolt USD/JPY as bets grow for a BoJ tweak before year-end.
• U.S. Housing Starts / Michigan Sentiment: A solid consumer-confidence rebound (target 61.5) might offset weak retail sales, but another miss would confirm demand erosion.

Earnings Overlay: Banks, Netflix, Industrials

JPMorgan, Bank of America, and Goldman open the Q2 earnings lid. Analysts now expect 5.8 % S&P 500 EPS growth, sharply lower than April’s 10 % forecast. Positive net-interest income could cushion the banks, while Netflix subs and 3M margin commentary will gauge tariff fallout.

FX Pressure Points

1. EUR/USD: Diverging CPI trajectories and Fed vs. ECB rhetoric.
2. GBP/USD: Retail strength vs. inflation test; 1.3480 remains pivotal support.
3. USD/JPY: Rising U.S. yields vs. Japan CPI shock potential.

Event-Risk Matrix

| Trigger | Likely Reaction |
| — | — |
| CPI > 3 % Core | DXY +0.8 %, stocks sell-off, gold dips |
| UK CPI < 3.3 % | GBP dives 0.7 %, gilt curve bull-flattens |
| Retail Sales ≤ -1 % | USD softer, recession chatter rises |
| Japan CPI ≥ 3.7 % | Yen rally, Nikkei pullback |

Strategy Takeaway

Volatility clustering is back: three major CPI prints, U.S. retail sales, and early earnings all drop within 96 hours. With option-implied moves still cheap, hedging longs makes sense. Directionally, watch for a dollar sell-off if both CPI and PPI undershoot—but be ready to fade extremes, given how quickly sentiment can swing on tariff tweets or earnings beats.

Stay light, stay nimble, and remember that in July’s thin markets, one data miss can feel twice as big.