(CEP News) - The dominant theme in the euro zone for the upcoming week will be German investor and business confidence, with both the ZEW and the Ifo sentiment surveys for April scheduled for release. It’s also a busy week in the UK with the release of the Bank of England minutes, the 2009 budget proposals and employment and CPI reports.

Simon Derrick, senior currency strategist from Bank of New York Mellon, said he doesn’t think most of the data from the UK is going to have a big impact on markets.

He said unless the data added anything new, the sterling could continue to make gains against the euro.

“I believe that expectations for the UK economy are fully priced in,” he said. “Right now the pound looks undervalued.”

The most focus will be on the Bank of England minutes. At the April meeting, the central bank took a break: rates were held, and no new quantitative easing measures were announced.

“Any quantitative easing measures have been negative for sterling and any commentary regarding the need for new measures could cause a selloff,” said Derrick. “However, I am expecting that the bank will now take a conservative view on interest rates.”

UK Chancellor of the Exchequer Alistair Darling is expected to make his budget proposals to parliament on April 2. Over the last few days, the UK media have been speculating that Darling will issue the largest revision to economic forecasts in the history of his position. Darling is expected to officially unveil a series of government initiatives to stimulate a sharply deteriorating labour market.

In Europe, on Tuesday, the Centre for European Economic Research (ZEW) will release the results of its economic sentiment survey for Germany. The ZEW release is a widely-viewed barometer of how analysts and investors in the euro zone’s largest economy expect the economic situation to develop in six months time.

Ahead of the report, forecasts suggest that investors’ opinions of the current economic environment will continue to deteriorate, bringing the ZEW current situation component down to -90.0 in April, down 0.6 points from the previous month’s level.

Nordea Bank analyst Martin Ipsen expects the ZEW headline figure to rise to 5 on the back of falling energy prices and sharply lower interest rate levels.

The current conditions are very low, so we are down to a point where things can only get better, Ipsen said.

A couple of days after the ZEW publication, Germany’s Ifo Institute will publish its business climate indicator the measure of German business sentiment based on a survey of up to 7,000 executives for April.

Expectations are for a mild uptick in business sentiment for the month to 82.3 after especially strong pessimism brought down the indicator to a record low 82.1 in March.

Businesses improved sentiment towards the economic outlook will be the main upward contributor to the modest rebound, according to forecasts. Economists expect the expectations component of the indicator to rise further to 82.6 from March’s 81.6 level.

Economists at Helaba expect a mild recovery in the business climate figure to 82.6, slightly better than the median consensus figure.

According to Helaba forecasts, expectations will continue to improve. However, they argue, due to the poor economic condition at the moment, the current assessment will remain quite weak and will continue to weigh down on the Ifo headline figure.

The economic environment is very weak in Germany, Helaba economist Claudia Windt said. This is why we don’t expect a strong rebound in the Ifo.

All times in EDT.

Sunday:

19:01 GB Rightmove House Prices (M/M) April Prior: +0.9%

19:01 GB Rightmove House Prices (Y/Y) April Prior: -9.0%

Monday: No major data is expected to be released in the UK or Europe

Tuesday:

2:00 DE Producer Prices (M/M) March Exp: -0.3% Prior: -0.5%

2:00 DE Producer Prices (Y/Y) March Exp: +0.1% Prior: +0.9%

3:30 SP ECB’s Ordonez, Santander’s Saenz Speak in Madrid

4:00 IT Trade Balance (Total) February Prior: -3585

4:00 IT Trade Balance euro zone February Prior: +404.0M

4:30 GB CPI (M/M) March Exp: +0.2% Prior: +0.9%

4:30 GB CPI (Y/Y) March Exp: +2.9% Prior: +3.2%

4:30 GB Core CPI (Y/Y) March Exp: +1.5% Prior: +1.6%

4:30 GB Retail Price Index March Prior: +211.4

4:30 GB RPI (M/M) March Exp: -0.2% Prior: +0.6%

4:30 GB RPI (Y/Y) March Exp: -0.5% Prior: +0.0%

4:30 GB RPI ex-Mortgage Interest Payments (Y/Y) March Exp: +2.2% Prior: +2.5%

5:00 DE ZEW Survey (Econ. Sentiment) April Exp: +2.0 Prior: -3.5

5:00 DE Zew Survey (Current Situation) April Exp: -90.0 Prior: -89.4

5:00 EU ZEW Survey (Econ. Sentiment) April Exp: +0.0 Prior: -6.5

13:30 EU ECB’s Papademos Speaks to EU Parliament in Strasbourg, France

Wednesday:

4:30 GB Claimant Count Rate March Exp: +4.6% Prior: +4.3%

4:30 GB Jobless Claims Change March Exp: +116.0K Prior: +138.4K

4:30 GB Average Earnings including bonus (3-month average) (Y/Y) February Exp: +1.4% Prior: +1.8%

4:30 GB Average Earnings ex bonus (3-month average) (Y/Y) February Exp: +3.4% Prior: +3.5%

4:30 GB ILO Unemployment Rate (3-month average) February Exp: 6.7% Prior: 6.5%

4:30 GB Manufacturing Unit Wage Cost (3-month average) (Y/Y) February Prior: +8.1%

4:30 GB Public Finances (PSNCR) March Exp: +18.0B Prior: +4.4B

4:30 GB Public Sector Net Borrowing March Exp: +15.5B Prior: +9.0B

4:30 GB M4 Money Supply (M/M) March Preliminary Exp: +1.2% Prior: +1.4%

4:30 GB M4 Money Supply (Y/Y) March Preliminary Exp: +19.2% Prior: +18.7%

4:30 GB Bank of England Releases Minutes of Interest Rate Decision

5:00 EU Euro-Zone Gov’t Debt/GDP Ratio Prior: +66.3%

7:30 GB U.K. Chancellor of the Exchequer Makes Budget Statement

April 22 EU ECB’s Quaden Speaks at a Conference in Belgium

Thursday:

2:45 FR Business Confidence Indicator April Exp: +69 Prior: +68

2:45 FR Production Outlook Indicator April Exp: -67 Prior: -70

2:45 FR Own-Company Production Outlook April Exp: -44 Prior: -45

3:00 FR PMI Manufacturing April Preliminary Exp: +37 Prior: +36.5

3:00 FR PMI Services April Preliminary Exp: +43.7 Prior: +43.6

3:30 DE PMI Manufacturing April Advance Exp: +33 Prior: +32.4

3:30 DE PMI Services April Advance Exp: +42.4 Prior: +42.3

4:00 EU ECB Euro-Zone Current Account SA February Exp: -10.7B Prior: -12.7B

4:00 EU PMI Manufacturing April Advance Exp: +34.7 Prior: +33.9

4:00 EU Euro-Zone Current Account (NSA) February Prior: -18.2B

4:00 EU PMI Services April Advance Exp: +41.3 Prior: +40.9

4:00 EU PMI Composite April Advance Exp: +38.9 Prior: +38.3

5:00 EU Industrial New Orders SA (M/M) February Exp: -2.2% Prior: -3.4%

5:00 EU Industrial New Orders SA (Y/Y) February Exp: -34.8% Prior: -34.1%

6:00 GB U.K. CBI Quarterly Industrial Trends Total Orders

April 23 PO Bank of Portugal Publishes Statistical Bulletin

April 23 SP EU Energy Commissioner in Barcelona, Spain

Friday:

2:45 FR Consumer Spending (M/M) March Exp: +0.2% Prior: -2.0%

2:45 FR Consumer Spending (Y/Y) March Exp: -0.5% Prior: -2.0%

4:00 DE IFO - Business Climate April Exp: +82.3 Prior: +82.1

4:00 DE IFO - Current Assessment April Exp: +82.1 Prior: +82.7

4:00 DE IFO - Expectations April Exp: +82.6 Prior: +81.6

4:30 GB GDP (Q/Q) Q1 Advance Exp: -1.5% Prior: -1.6%

4:30 GB GDP (Y/Y) Q1 Advance Exp: -3.8% Prior: -2.0%

4:30 GB Retail Sales (M/M) March Exp: -0.3% Prior: -1.9%

4:30 GB Retail Sales (Y/Y) March Exp: +1.1% Prior: +0.4%

4:30 GB Index of Services (3-month Average) February Prior: -1.3%

By Todd Wailoo, twailoo@economicnews.ca; edited by Nick Say, nsay@economicnews.ca

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