The first task for the new group of 18 Tory MPs after Monday’s referendum will be to agree the rules for electing their new party leader (ie the British prime minister). This is expected to be completed by September. A group of MPs have already thrown their hat into the ring, but these could be whittled down to a shortlist of two in a matter of days, according to the FT Parliamentary Group. The timing for the new prime minister’s decision is important and serious, with UK inflation the highest in the G7 and the country’s growth next year (if it grows at all) forecast to be the slowest, according to the IMF . There is a critical need for someone capable of leading the country through the interim period before the public once again decides on their government through a general election. A passenger boards an underground train in London. Further train trouble is on the cards © Dan Kitwood/Getty Images Also, the British summer of discontent begins. If nothing else, it’s gaining momentum. Criminal lawyers will be out again on Monday, for reasons explained in this article by legal entity. Further train trouble is on the cards with unions Aslef, which represents train drivers, and TSSA, which represents more than 6,000 Network Rail staff, voting to strike. And on Friday, a vote on industrial action closes for members of the Union of Universities and Colleges in a separate dispute over low pay, unmanageable workloads and professional respect. This could lead to further disruption for students at UK universities and colleges once this long hot summer of unrest is over.
Financial data
It’s a busy week for major economic data releases, including inflation figures for the US, UK, France and Germany – likely to give an indication of whether cost-of-living rises are nearing a peak – plus the of GDP from China and the United Kingdom. The Federal Reserve is releasing its latest Beige Book on the current state of the US economy, and the rate-setting committees of the central banks of New Zealand and South Korea could raise their respective interest rates by 50 basis points. Also, Croatia is accepted as the last member of the eurozone group.
Companies
US banks will kick off the US earnings season this week, with forecasts for better results thanks to Fed rate hikes. Analysts expect JPMorgan Chase, Bank of America and Citigroup to see a rise in net interest income, the difference between what banks pay depositors and what they earn on loans and other assets. The big fear is recession. Banks are usually the stocks that get hit the hardest during recessions. When trouble looms on the horizon, pressure increases to increase capital buffers in case existing loans turn bad. Read the full calendar for the week here
