Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Britain’s cost of living squeeze is in the spotlight this morning, as we get new inflation figures showing how price changed in May.
City economists predict that the Consumer Prices Index rose to around 2.5% last month, up from 2.4% in April, squeezing household budgets.
That would be a blow to consumers, especially as we learned yesterday that basic wage growth slowed to 2.8% in the last quarter,
Royal Bank of Canada predicts that CPI could even have hit 2.6%, which would almost wipe out real wage growth. They point out that petrol prices have risen steeply in recent weeks, as higher oil prices feed through to the pumps.
On the other hand, Marc Brütsch of Swiss Life thinks inflation might be unchanged.
So the pound could be volatile when the data is released, as inflation is a key factor determining whether the Bank of England raises interest rates soon.
Advertising giant WPP will also dominate the headlines today, as it faces irate shareholders at its AGM.
Investors are furious that former CEO Sir Martin Sorrell was allowed to quit the company in April with millions of pounds worth of share awards, despite facing allegations of personal misconduct.
We’ve subsequently learned that those allegations centred on claims of workplace bullying and paying for a sex worker using funds from WPP.
Sorrell turned WPP from a small wire basket maker into the world’s largest advertising company.
He would have featured highly on a list of Britain’s most respected executives – before recent events unfolded.
Shareholders will demand answers about Sorrell’s departure, and succession planning (or the lack of it) at WPP.
Some will vote against WPP’s pay policy, which is set to hand Sorrell future share awards worth up to £20m, despite a lack of information about the reasons for his departure.
Investors are also unhappy that Sorrell wasn’t bound by a non-compete clause, allowing him to set up a new technology and content company called S4.
There could also be a revolt against chairman Roberto Quarta. Tin hats could be needed….
The financial markets look quiet, as traders wait for the US Federal Reserve’s decision on interest rates tonight (a hike is widely expected).
- 9.30am BST: UK inflation data for May
- Noon BST: WPP Annual General Meeting
- 7pm BST: US Federal Reserve interest rate decision
- 7.30pm BST: Fed chair Jerome Powell’s press conference