Japanese Consumer Confidence (JUN) (05:00 GMT, 01:00 EST)
Consensus:           48.0
Previous:               49.9

Outlook: Despite a rise in business confidence, as indicated by the Tankan survey, consumer confidence is likely to dip down to 48.0 in June, from 49.9 in May.  Rising prices for items such as gasoline and household goods have families concerned that the cost of living may rise.  If consumers feel overwhelmed by price increases, they are more likely to tighten their purse strings and limit their spending, which accounts for more than half of the economy.  Bank of Japan Governor Fukui's involvement with Yoshiaki Murakami could also put a dent in consumer confidence, after polls by the Asahi newspaper indicated that nearly 67 percent of people surveyed thought Fukui should resign.  However, wide support for the governor by others in the government and central bank may help to curb the pessimism.

Previous:  After rising in May, the consumer confidence report dipped slightly to 49.9 in May as weakness in near term consumer spending and overall economic prospects was witnessed in the month. Strengthening with confidence earlier in the year, posting two consecutive 1.1 percent monthly gains, retail trade had dipped slightly according to the most recent report. The dip looked to be as result of widely felt losses in benchmark equities, with many investors reluctant to spend as losses mount in domestic investments. The hesitation looked to also be a product of speculation surrounding the final decision to lift rates in the world's second largest economy. Nonetheless, expectation remained somewhat positive as employment prospects continued to remain plentiful with an unemployment rate remaining at 15-year highs. The report remained optimistic and added to recent speculation of rate hike considerations by the Bank of Japan.

UK Visible Trade Balance (British pounds) (MAY) (08:30 GMT, 04:30 EST)
Consensus:          -5.70B
Previous:              -5.75B

Outlook:  Net trade could make a small positive contribution to growth during 2006, and things do appear to be improving a little entering the second quarter, as the UK's trade balance is expected to post a deficit of Ã,£5.7 billion. April's deficit of Ã,£5.8 billion was considerably narrower than the average monthly deficit of Ã,£6.5 billion during the first quarter of 2006.  Reasonable growth in domestic demand should sustain the inflow of imports, but with export markets still enjoying strong growth, the deficit is unlikely to widen materially.

Previous:  The UK trade deficit was expected to have widened slightly during April to Ã,£5.8 billion, but was slightly better at Ã,£5.75 billion.  Looking to the simple components of the balance, exports grew over the month, especially those destined for the EU whose conglomerate economy continues to grow at a faster clip.  The European Commission released predictions that the Euro-zone's economy will grow 0.5 and 0.9 percent over the second and third quarters respectively.  Nonetheless, this occasion had to compete with higher import costs such as those of materials like crude oil, which rose to record highs in over the period.  Additionally, exports specifically to the United States, a significant consumer of British goods, also felt some pressure of the appreciation of the pound against the dollar that had evolved since the beginning of the year.

Bank of Canada Rate Decision (13:00 GMT, 09:00 EST)
Consensus:          4.25%
Previous:              4.25%

Outlook:  The Bank of Canada's monetary policy meeting, which has recently garnered a substantial amount of attention from traders and economists, will reveal the results of its two-day meeting on Tuesday at 13:00 GMT.  A majority consensus amongst economists suggests the central bank is prepared to put an end to its string of seven consecutive rate hikes in favor of analyzing the effects of past policy tightening on the economy.  This prediction looks well founded.  Firstly, supporting the least probable outcome, there have been a few economic indicators since May 24th that have rallied heated speculation around a 25-basis point hike.  First quarter economic growth accelerated to an annualized 3.8% pace, hiring surged four times greater than expected in May, core inflation accelerated to the bank's upper tolerance level and retail sales boomed in April.  However, recent economic counters and official's statements have effectively rendered each of these indicators feeble.  April's monthly read of GDP failed to match expectations of a 0.2% acceleration while noticeable downturns in recent manufacturing and trade data, due to a expensive currency, put future expansion projects in doubt.  In the labor market, firms actually laid off a net 4,600 people in June, for the first contraction in payrolls this month.  However, the central argument floating in the FX market comes from the BoC Governor David Dodge himself.  Following the previous rate hike, Dodge had said that the policy group would pass on a rate hike in July in order to assess the market's ability to absorb the previous seven shifts.  Even when speculation of a hike reached its pinnacle, with the back-to-back releases of core CPI and retail sales, Dodge squelched the speculation by saying the BoC still thinks its forecasts of growth and inflation are "reasonable" and within limits through the year's end.

Richard Lee is a Currency Strategist at FXCM.