Kim Yo-jong

The leaders of the United Kingdom and European Union launch their trade talks s on Monday.

Post-Brexit trade

UK Prime Minister Boris Johnson will talk to the President of the Council of Europe Charles Michel, President of the European Commission Ursula von der Leyen, and President of the European Parliament David Sassoli via videoconference, together with chief his chief Brexit negotiator David Frost and Cabinet Office minister Michael Gove.

The Telegraph newspaper reported earlier on Monday that Johnson will tell Europeans that negotiations should result in a trade deal at “latest” by fall.

The parties will hold talks to try to reach an agreement every week between June 29 and July 27. Johnson wants a free trade agreement that the EU similar those Brussels with Canada and Japan.

BoJ meeting

The Bank of Japan (BoJ) starts this month’s two-day policy meeting on Monday.

No major change in the monetary policy is expected from BoJ, but the bank Governor Haruhiko Kuroda is expected to emphasize his determination to combat the economic collapse from the Covid19 epidemic.

Kuroda might clarify how aggressively BoJ will buy Japanese Government Bonds with a maturity of more than 25 years.

Powell at the Congress

US Federal Reserve Chairman Jerome Powell will testify to Congress to present his six-month monetary policy report to the Senate on Tuesday and then to the House of Representatives on Wednesday.

Powell said after the Fed’s meeting last week, the bank would not raise interest rates at least until the end of 2022.

BoE

The Bank of England (BoE) will hold its monetary policy meeting on Thursday.

Analysts expect the BoE to leave interest rates where they are, but speculations that the bank may pull interest rates below zero in the near future abound.

For now, BoE may choose to expand its bank asset purchase program.

EU meeting

EU country leaders will meet virtually on Friday to discuss the budget of the bloc and a recovery fund of 750 billion euro to combat the fallout from the coronavirus crisis.

Member states call on Brussels to consider the economic threat posed by Brexit in addition to the pandemic. Some member states, such as Austria and Denmark, are also questioning the proposed methodology behind the rescue fund.

Other issues to be discussed will be the balance between the conditions associated with the rescue fund and the distribution of grants and loans.

Korean Peninsula

Tensions are rising in the peninsula where nuclear weapons are held as North Korea suddenly cut off all lines of communication with the South last week.

The communist Pyongyang regime increased its verbal threats to the US and South Korea over the weekend. Kim Yo Jong, the sister of North Korean leader Kim Jong-un, targeted the South with the threat of “military action against the enemy”. Shortly later the South Korean government held an urgent national security meeting Sunday.

“Our invincible revolutionary powerful military will launch an act that will take revenge for our people who have become angrier than ever,” Kim Yo Jong said.

Economic Calendar

Monday: Switzerland PPI, Eurozone Trade Balance

Tuesday: RBA Meeting Minutes, BoJ Monetary Policy Statement, UK Average Earnings Index +Bonus, UK Claimant Count Change, BoJ Press Conference, German ZEW Economic Sentiment, US Core Retail Sales, US Retail Sales

Wednesday: Britain CPI, Eurozone CPI, US Building Permits, Canada Core CPI, US Crude Oil Inventories, New Zealand GDP

Thursday: Australia Employment Change, SNB Interest Rate Decision, SNB Monetary Policy Assessment, SNB Press Conference, BoE Interest Rate Decision, BoE MPC Meeting Minutes, US Initial Jobless Claims, US Philadelphia Fed Manufacturing Index

Friday: Australia Retail Sales, UK Retail Sales, Canada Core Retail Sales

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