GBP: MPC Minutes; inflation, labour market and retail sales data

The June BoE MPC minutes will be a key focus next week. Discussion is likely to centre on the poor growth start to this year and the consequent lack of urgency for rate hikes, particularly in the context of tight fiscal policy, market volatility and continuing Greek political uncertainty. 

However, the minutes may also reflect more hawkish members of the Committee, such as Ian Mccafferty, who in a speech on Friday emphasized that "the time of the extraordinary policy stance of recent years is gradually drawing to a close".There are also several important data releases next week.

Barclays notes:

• We forecast CPI inflation to increase 0.3% y/y (Monday, consensus: 0.1%). In Wednesday's labour market report, we and consensus expect unemployment to remain at 5.5%.
  
  
• Core earnings should grow 2.1%y/y (consensus: 2.3%) and bonus pay to push up total earning to 2.3% y/y (consensus: 2.5%). Jobless claimants for the month of May should drop another 10k (consensus: -12.5k). 
  
  
• Finally, we expect May retail sales to disappoint, growing 4.1% y/y after 4.7% in April (consensus: 4.6%). In line with our Barclays Card Spend Trend indicator, we see values easing somewhat while price deflation remains similar to April.