New Zealand Current Account (1Q) (22:45 GMT; 18:45 EST)
Consensus: -NZ$2.233B
Previous: -NZ$3.857B

Outlook: Although New Zealandââ,¬â"¢s current account deficit is expected to contract for the quarter; the annual figure is still expected to swell to a record NZ$14 billion.  If met, the additional gap in the first three months of the year would position the shortfall to account for an astounding 9.0% of GDP.  The readings from each three-month period are not seasonally adjusted and tend to fluctuate wildly, rendering the number difficult to work with.  However the rolling annual total tends to provide a clear indication of deficits.  This may comfort few however given RBNZ Governor Alan Bollardââ,¬â"¢s prediction for the account shortfall to reached a staggering 9.7% of GDP by the same time next year.  Looking back to the coming release, wages for the first quarter of 2006 are projected to show a record increase, while jobless rate remains low.  This puts more money in consumersââ,¬â"¢ pockets, yet much of it was likely spent on foreign goods. Imported gasoline rose almost 51% since March 2005, a weight contribution to more moderate spending on imported cars and computers.  Overall, the current account could be the most important indicator for the kiwi given its sputtering economy and growing inability to draw capital even with high interest rates.  Not long ago, Standard & Poorââ,¬â"¢s debated whether they should decrease the countryââ,¬â"¢s sovereign credit rating from AA+ and a bad showing in this measure could revive debate.

Previous:  Consumer demand rose in step with rising wages and falling unemployment, but the New Zealand fourth quarter current account balance didnââ,¬â"¢t benefit.  New Zealandââ,¬â"¢s forth quarter account deficit ballooned to NZ$3.857 billion for the final three months of 2005.  The decline, however, was in line with expectations as the quarterly numbers tend to vary widely with seasonal fluctuation.  Weighing on trade conditions for the period were an expensive currency, expensive imports and temporary dips in the global demand amid international oil fears.  In all, the annual account deficit soared to a new record high at 8.9% of GDP, which further put pressure on an already ailing kiwi.

Japanese All Industry Activity Index (MoM) (APR) (23:50 GMT; 19:50 EST)
Consensus:  1.1%
Previous: -0.4%

Outlook: Following a bigger-than-expected gain of 1.3% in the April tertiary index, the all-industry activity index, which covers a broader range of economic activity, is likely to rise 1.1% in April.  Japan has seen an array of positive data, as manufacturing has gotten back on track, supported by continuing export gains amid a global pick-up in demand.  Domestic demand and capital spending growth have also improved, leading to first quarter GDP improvements of 0.8%.  The Bank of Japan also acknowledged the expansion seen as of late in the monetary policy committee minutes, which were released recently.  Continued gains in the manufacturing and services sectors, as well as domestic consumption, could lead to an end to ZIRP sooner rather than later.
 
Previous:  The Japanese all-industry activity index declined for the second month in a row by 0.4% in March, as consumers and companies continued to trim spending after the biggest expansion in a year in January.  This slowdown fell in line with the decrease in the tertiary index, which slipped 0.6% in March.  Other indicators of spending and growth, however, have showed improvements and may indicate that the slowdown in the aggregate index could be temporary.

Swiss Trade Balance (MAY) (06:15 GMT; 02:15 EST) 
Consensus: SFr 1.00B
Previous: SFr 0.91B

Outlook:  Following the growth in Switzerlandââ,¬â"¢s trade surplus in April, the countryââ,¬â"¢s balance is expected to have expanded once again last month to SFr1.0 billion francs in May.  Export pickup is likely to continue to fuel growth for the country, as the manufacturing sector has benefit from the inflow of foreign funds garnered from the past strength of sales abroad.  Evidence of this was Industrial production, which rose 9.2% in the first quarter from a year earlier, the most in six years.  New orders also made a huge increase, jumping 16%.  The momentum gained by these businesses has allowed them to allocate more funds towards labor costs to bolster capacity limits, which as a positive side effect improved the jobless rate to 3.3% in May and boosted wages.

Previous:  Switzerland's positive trade balance widened to 0.91 billion francs in April from 0.61 billion francs in March.  Growth in exports, versus fluctuations in import numbers, made the largest contribution to figure, rising 8.6%.  In contrast, imports advanced only 3.8%, largely due to rising petrol costs.  Faster growth and signs that higher oil prices are driving up producer prices convinced the Swiss National Bank's policy makers to raise borrowing costs at their meeting earlier this month.

UK CBI Industrial Trends (JUN) (10:00 GMT; 06:00 EST)
Consensus: n/a
Previous: -25

Outlook:  The Confederation of British Industry trends survey is expected to show sustained confidence in the British manufacturing sector even as economists forecast a small drop in manufacturing orders.  The British manufacturing sector appears to be staving off another recession and start contributing to economic growth though rising inflation, and unrelenting increases in raw material and energy costs threaten sustainable growth.  The most recent read of Manufacturing production, for April, declined -0.2% against an expected 0.3% increase.

Previous:  Manufacturing confidence took a hit in May as order levels dropped, with 22% of those surveyed reporting order increases over the next three months and 32% reporting declines.  The overall level printed at -25, with export orders -13.  Manufacturing and industrial production surveys for March, however, surprised strongly to the upside, beating 0.2% expectations by touting 0.7% rises.  The numbers indicate strong current growth but future levels are still murky given expensive inputs and questionable domestic demand.

US Leading Indicators (MAY) (14:00 GMT; 10:00 EST)
Consensus: -0.5%
Previous: -0.1%

Outlook:  The United Statesââ,¬â"¢ composite index of leading economic indicators is expected to drop by the most in seven months.  A -0.5% read is expected as seven of the 10 indicators that comprise the read are already known.  Most influential amongst the negative components for the month of May are likely to be the read on equities, building permits and consumer sentiment.  Most recently, a read of building permits showed a 2% contraction in permits for May, foreshadowing continued rough conditions in the future.  Consumers expectations are already clearly negative amid expensive gasoline prices and speculation of unquenchable lending rate hikes that will make mortgages and purchases on credit a more costly endeavor.  Also wearing down consumer sentiment, while at the same time being a component of the index in itself, were jobless claims.  Claims jumped last month while at the same time employment increased the least in seven months.  Finally, the drop in share value for the month will cap off the negative run leading indicators are expected to report.  When looking back over all of these indicators, it is easy to see that much of the downturn can be attributed to the fedââ,¬â"¢s aggressive rate policy.  As rates rise equities fall, employment suffers and consumer sentiment is suppressed.  While this indicator is not normally very market moving, it may be the first certain signal that the US economy is finally feeling the effects of the Fedââ,¬â"¢s rate hikes.

Previous:  The US Leading Indicator for April unexpectedly fell -0.1% after a 0.4% reading in March, indicating a possible slowdown in the coming months.  The news comes as inflation concerns continue to mount and gas prices maintain their climb.  Rising inflation has worn on the housing market, which ras recently been a generous contributor to economic growth, while consumersââ,¬â"¢ spending habits have been pressured by the increased cost of fuel.  While the increase in oil has yet to produce a marked slowdown in consumer spending, sustained or worsening gas prices could contribute to a decline in disposable income and affect the broader market.

Richard Lee is a Currency Strategist at FXCM.