Australian Producer Price Index (2Q) (01:30 GMT; 21:30 EST)
                        (QoQ)       (YoY)
Consensus:       1.1%        n/a
Previous:           0.8%       3.8%

Outlook: Australia's producer price index is expected to have risen 1.1 percent during the second quarter of 2006.  With commodities prices rising across the board during the quarter - oil consistently hitting record highs, iron prices scaling higher - producers were confronted with engorged costs for the materials usually used in production.  Some relief many have been found from an expensive currency, which could have helped offset some of the record prices in some key commodities and other imported materials.  Other factors to consider for the pass through in costs to the factory gate are both the sharp correction in a few very dear necessary goods and the willingness of domestic consumers to except the marginally higher prices.  Of note, crude, gold and copper prices corrected sharply in May from recent historical highs, providing some relief in the bottom line.  The true test was whether factories ran the risk of raising prices if they believed consumers had more in the bank and were willing to use it.  The national jobless rate at a 30-year low through the quarter providing a boost to optimism, though a rate hike in May could have diminished the cheer somewhat.  Market participants will be looking to the PPI number as a long-term gauge of upstream inflationary pressure that may lead the RBA to consider an additional hike in August at the earliest.

Previous:  Producer prices in Australia rose 0.8 percent in the first quarter of this year, putting the index on pace for an annual reading of 3.8 percent.  Imported materials saw the largest rise in prices as the Australian dollar lost a good deal of strength during the first three months of this year.  The considerably higher price of crude products relative to this time last year was the stimulus for the bulk of the 3.8 percent jump.  With little relief in commodity prices in the immediate future, and the consumer and export sector showing a shift to greater demand in the future, the RBA decided to raise overnight lending rates to suppress spending to control underlying inflation.

Euro-Zone Industrial New Orders (MAY) (09:00 GMT; 05:00 EST)
                         (MoM)         (YoY)
Consensus:       -0.2%          9.0%
Previous:          -0.2%          4.4%

Outlook:  Euro-zone industrial new orders are expected to have dropped a seasonally adjusted 0.5 percent in May.  The figure however is expected to be 9.0 percent higher than the same month in 2005.  As some regions of the manufacturing sector in Euro-zone continue the push out of recessionary troubles, domestic demand is beginning to fuel new orders more and more in the stead of the typical foreign booking.  While other preliminary reports have begun to show export demand is slowing a bit from levels seen at the beginning of the year, a recovery is becoming more likely with business economies like Germany, which is running at a 15-year high for business confidence, providing a solid foundation for demand.

Previous:  Industrial new orders fell 0.2 percent in April as compared to the month prior.  There was however a 4.4 percent increase over the April 2005 reading. Basic metals and fabricated metal production increased by 5.2 percent and chemicals and chemical product orders grew by 3.3 percent during the month.  A significant fall, however, was seen in orders for transport equipment.  The year on year gain was also driven by a large gain in orders in the basic and fabricated metals sector of 10.7 percent.  Despite the small drop in new orders, manufacturing is still said to be growing at its fastest pace in 6 years.

Canadian Retail Sales (MAY) (11:00 GMT; 07:00 EST)
                          (Core)        (ex Autos)
Consensus:         0.1%             0.4%
Previous:            1.7%             1.9%

Outlook: Sales at Canadian retailers is expected to slow markedly in May as the solid jump in gasoline receipts, and an a lagged effect thereof may have been felt in many other components.  The core sales figure is expected to expand a sparse 0.1 percent in May as the nearly 10 percent jump in gasoline receipts the month before moderated with the price of the underlying commodity.  However, a decline itself is not likely to have provided immediate relief to consumers.  Instead, aching from the income that had been sapped from their accounts over the previous weeks, they were likely more prone to put aside money in case prices should rise once again.  One category that will be particularly important at the retail level will be the effect on auto purchases.  Excluding autos and parts, retail sales are expected rise actually have risen 0.4 percent.  This makes sense given the greater cost to finance and fuel an car, but it is contradictory to the wholesales report provided last Thursday.  According to the report, purchases from wholesales in May doubled expectations largely on part of better vehicle sales.  After the Bank of Canada decided to hold interest rates steady for the time being, FX market participants will be looking to economic indicators for signs that growth may be slowing, and the central bank's decision to halt was not actually enough.

Previous:  Retail sales soared 1.7 percent in April, far outpacing the consensus among economists.  In an environment of record crude and near record gasoline prices, an employment rate near a 30-year low and enviable wage growth on the global scene has done well to keep consumers coming back for more.  According to the break down of the data, of the eight categories within the retail sector, six had contributed positive marks.  The single largest contribution to the overall read came from the automotive branch, which included sales of new and used cars as well as gasoline receipts.  While new cars were deemed a pricey venture considering rising lending rates and expensive fuel, used cars were more than a viable alternative for a wealthier populace.  Used car sales rose 7.2 percent for the month, while new vehicle sales actually dipped 0.4 percent.  However, the real progress was seen at the pump.  Gasoline stations reported a 9.3 percent jump in sales as the price per gallon soared as nearly every category of energy product grew.  Making for a stellar performance, the retail data was taken in conjunction with the huge jump in employment, that was released at the same time, to mean the Bank of Canada would have to revoke its dovish commentary and raise rates to rein in the aggressive consumer.

Richard Lee is a Currency Strategist at FXCM.