Another thin day of fundamental news on the economic calendar with very little of substance, as markets absorb the implications of the geopolitical fallout from the escalating “conflict” with North Korea who seems to determined to provoke the world with its nuclear antics.  The principal item of fundamental news in Europe today is the preliminary CPI data for Germany which is drip fed to the market as the numbers are released by the various German states and these all report throughout the day.  The preliminary release is the earliest indicator of inflation/deflation and the forecast is for 0.1% against a previous of 0%.  Some states have already released their data, most notably Brandenberg and Hesse, both of which turned negative in May after energy prices fell with the latter of these falling to -0.4%, the lowest level since 1987.  Many economists are now forecasting that German inflation will slow to around 0.2% with lower crude oil prices and falling demand adding to the gloomy picture in Germany, the economic powerhouse of Europe.

The only item of interest this afternoon in the US is Exisiting Home Sales which are forecast at 4.65m against a previous of 4.57m.  In addition we have a speech from Treasury Secretary Geithner who is due to speak on the new tax credit programme in advance of his visit to China.

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