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[Quick Facts]

1. U.S. inflation data is expected to be a reason for the Fed to suspend rate hikes.

2. Saudi Arabia says OPEC+ is tackling market uncertainties.

3. The two warring factions in Sudan have agreed to a temporary ceasefire.

4. NATO lacks consensus on Ukraine's membership.

5. The UK economy is expected to avoid a recession, but problems remain.

[News Details]

U.S. inflation data is expected to be a reason for the Fed to suspend rate hikes

The U.S. will release its latest CPI data on Tuesday, and economists expect the annual rate of headline inflation to be 4.1% in May. This will be a sharp slowdown after only a modest deceleration in April. The decline in headline inflation is expected to be driven by weaker energy prices. It indicates that the average price of regular gasoline fell by 2.1% from a month earlier. While the core CPI, excluding the volatile food and energy sectors, is expected to reach an annual rate of 5.2%, and used car prices will keep the core CPI at a high level. The data will be released ahead of the Fed's June rate resolution and is expected to bolster the Fed's confidence to pause its historic rate hike this month. It should be noted that this does not mean rates have peaked.

Saudi Arabia says OPEC+ is tackling market uncertainties

Saudi Arabia and its OPEC+ allies are trying to combat "uncertainties and sentiment" in the oil market as the group looks to tackle short sellers, the Saudi energy minister said on Sunday. He also said that they believe the physical market is telling them something and the futures market is telling them something else, which is why they have been taking these precautions. Many energy analysts, as well as OPEC, expect the oil market to tighten in the second half of this year as demand from China and India picks up further. High interest rates and economic weakness in the U.S. and Europe will be a drag on oil prices for at least the rest of the year. "To understand OPEC+ today, it's all about being proactive, preemptive, and precautionary," the minister said. Countries that invest in higher oil production will receive a higher production allocation, he added.

The two warring factions in Sudan have agreed to a temporary ceasefire

The Sudanese Armed Forces (SAF) and Rapid Support Forces (RSF) issued separate statements on June 9 local time, confirming their commitment to full compliance with the temporary ceasefire agreement and expecting the other side to effectively implement the agreement. The SAF also stressed that they reserve the right to respond to violations of the ceasefire agreement by the RSF. Saudi Arabia and the United States, which mediated the conflict in Sudan and supervised the ceasefire, issued a statement on June 9, announcing a new 24-hour temporary ceasefire agreement between the SAF and the RSF in the Saudi Red Sea port city of Jeddah on the same day. The ceasefire will begin at 6 a.m. Sudanese Khartoum time on June 10. Clashes between the SAF and the RSF erupted on April 15 in the capital Khartoum and continue to this day.

NATO lacks consensus on Ukraine's membership

NATO lacks consensus on Ukraine's membership, said NATO Deputy Secretary General Mircea Geoana. Earlier, Volodymyr Zelensky said that Kyiv hoped to receive an invitation to join NATO during the NATO Vilnius Summit in July. He also noted that the Ukrainian military was disappointed that Ukraine had not received a positive answer about joining the EU and NATO.

The UK economy is expected to avoid a recession, but problems remain

The UK economy now appears to be on track to avoid a recession this year, but deep-rooted problems such as weak business investment will persist. The Confederation of British Industry (CBI) said the British economy is expected to grow 0.4% this year and 1.8% next year, higher than previously expected. Factors such as falling energy prices and the easing of supply chain disruptions are the main reasons for this upward revision of expectations.

While this is encouraging, this year is expected to be another tough year for both businesses and households. The Bank of England may raise interest rates to a peak of 5% in August from the current 4.5%. In addition, the UK is underperforming in many areas, such as business investment, that are critical to long-term prosperity. Business investment is not expected to return to pre-pandemic levels until the end of next year.

[Focus of the Day]

UTC+8 14:30 European Central Bank Governing Council Simkus speaks

UTC+8 22:00 Bank of England monetary policy member Mann speaks