UK Retail Sales (JUL) (08:30 GMT; 04:30 EST)
                               (MoM)          (YoY)
Consensus:           0.2%             4.5%
Previous:                0.9%             3.7%

Outlook:  Slower retail sales are expected for July, marking the end of the spending-inducing World Cup tournament. However the end to the electronics binge for soccer viewing, and four-year high unemployment, shoppers will likely continue to turn out, keeping spending numbers on the month firmly in positive territory. With consumer confidence holding steady for the past three months, many are relying on consumer demand to lift retail sales to their fastest annual rate in nearly two years. These expectations appear to be well-founded, as the BRC reported 6.1 percent growth in July sales, more than a full percentage point above June's number.   Also funding such predictions, June wages reported 4.3 percent annual growth. With the Bank of England having declined to raise interest rates in its monthly meeting for the period and all signs pointing to continued demand, retail sales should reap the benefits in July.

Previous:  Retail sales rose in June by twice the amount expected as consumer demand continued to buoy the British economy. Much of the gain, of course, was attributed to the World Cup effect, as soccer fans turned out in droves to buy beer, food, and televisions. However, consumer demand appeared to be holding its own even before the World Cup, with retail sales growing for the previous four months and the housing market expanding steadily. With economic expansion the order of the day and inflation becoming a more serious concern, predictions mounted that England would see higher interest rates in the near future.

Euro-Zone Consumer Price Index (JUL) (09:00 GMT; 05:00 EST)
                               (MoM)         (YoY)
Consensus:           0.0%            2.5%
Previous:                0.1%            2.5%

Outlook:  After the ECB held rates flat in July, according to schedule, inflation is expected to follow through with an unchanged read for the same month but accelerate to its highest annual pace for the year.  Rising industrial and consumer confidence in July coupled with the lowest level of unemployment in years likely contributed to inflationary pressures.  On the other hand, predictions for the slower monthly figure could be seen as an effect of the winding down of the German-hosted World Cup.  In terms of rate speculation, although the European Central Bank is on a quarterly 25-basis point schedule of rate hikes, a jump in the second quarter's gross domestic product now has the market predicting three hikes by the opening months of 2007.  Nevertheless, with continuous CPI readings above the ECB's target rate and growth running at six year highs, the central bank may need to step up its removal of accommodative policy to ensure stability going forward.

Previous: Consumer prices within the nations that share the Euro rose by 2.5 percent from a year earlier in June as robust growth fueled quicker inflation.  The annual gauge has not eased since March, and now lies above the ECB's target rate of 2.0 percent for the seventeenth consecutive month.  The constituent with the highest inflation for the fourth straight time was Spain, a product of Zapetero's increased social and fiscal spending.  What's more, producer prices, which can serve as a leading indicator to the CPI, came in higher than expected at a 5.8 percent annual pace suggesting carry through for some time.  June's labor market also continued to improve, bringing unemployment down to 7.9 percent, which tends to move opposite with inflation.

Euro-Zone Industrial Production (JUN) (09:00 GMT; 05:00 EST)
                              (MoM)           (YoY)
Consensus:         -0.1%             4.0%
Previous:               1.6%             4.9%

Outlook: Industrial Production for June is expected to contract 0.1 percent following May's robust numbers. Disappointing survey data out of Germany is likely serving as the primary feed into the conservative estimates as Europe's largest economy posted lower PMI manufacturing and services data on the month as energy prices rebounded and the regions currency firmed. Another issue coming out of German were factory orders, which also fell close to quarter lows as higher prices cut into domestic spending. However, upside potential could lie in monthly survey indicators surrounding the Euro-Zone, which have been indicative and consistent with a healthy and growing economy.  Further stronger than expected second quarter German GDP data could have set momentum behind equipment investment by European firms as expectations of a consumer revival buoy managers' hopes.

Previous: May Industrial Production in the Euro-Zone experienced a strong 1.6 percent recover from April's bleak 0.7 percent contraction. With GDP growth 40 percent correlated to Industrial Production, May's sharp increase was headlined by stellar GDP data in the area's largest economies, including Germany, France and Italy, which recorded expansion around 1.5 percent on the year. Private Consumption, which grew by 0.7 percent on the quarter across the Euro-Zone, also helped steady industrial production in the midst of rising inflation and energy costs. Although recent rises in domestic demand partially represents a bounce from poorer numbers in the previous quarter, it potentially provides preliminary evidence of a possible sustained recovery in consumption.

Canadian International Securities Transactions (JUN) (12:30 GMT; 08:30 EST)
Consensus:          C$3.000B
Previous:               C$5.721B

Outlook:  Foreigners are expected to have slowed investment in Canadian securities following May's surprising influx as Canadian equities markets fell over 6 percent during May. While investors seemed optimistic that high oil and raw materials prices would help buoy the value of Canadian firms, the sharp and unexpected decline, which continued through the month of June, is likely to have shed many investors. Furthermore, with economic numbers indicating slowing inflation and the Bank of Canada announcing its intentions to end rate hike, purchases of Canadian bonds may have slowed on anticipation that yields be stagnant while yields on other economies' debt issuances continues to advance. However, with a ranging CAD maintaining most of its strength, and the Canadian economy still printing respectable numbers, net investment will likely moderate near the three billion level.

Previous: Foreign investment in Canadian securities jumped to a net C$5.7 billion, reaching an eighteen-month high. This number, which far outstripped the predicted C$1.5 billion, came as foreigners sharply increased purchases of Canadian equities. With oil and commodities prices retaining their strength throughout the month, speculation mounted that they commodity-heavy equity indices would provide serious return. In addition, with the Bank of Canada until then maintaining a hawkish position on interest rates and the Canadian economy plugging along at a robust pace, purchases of Canadian bonds increased by a net C$1.76 billion as investors continued to seek out rising yields.

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

Outlook:  The US leading indicators index, a gauge used to predict economic conditions in the coming three to six months for investors and businessmen, is expected to match the previous month's read with a 0.1 percent boost in July.  For this period, the tame increase is finding support from one of its biggest components.  The average workweek for manufacturing employees, accounting for more than a quarter of the total index, increased 0.4 percent in July according to labor data.  If in line with projections though the gauge will be down at an annual rate of 1.2 percent over the last six months, which would be the worst performance since February of 2001.  A weak economic illustration by the LEI reinforces Bernanke's expectations that "moderation in economic growth now seems to be underway," as stated in his congressional testimony. 

Previous: June's index for leading economic indicators in the US rebounded after a 0.6 percent decline in May, up 0.1 percent for the first gain in three months.  Six of the ten indicators contributed to optimism, led by the labor market with 30,000 fewer initial jobless claims.  The University of Michigan's consumer expectations also grew despite a waning real estate market.  The biggest weighting in the index is money supply, which also rose in June, adding 0.08 percentage points to the gain.  Business spending has also been picking up slack in the housing and stock markets, as seen in June's durable goods orders, which grew 3.1 percent.

Richard Lee is a Currency Strategist at FXCM.