What are the main events for today?

EUROPEAN SESSION In the European session, we have a rare busy agenda today. We will begin with the French CPI report which is expected to show another uptick in inflation due to the ongoing energy crisis. The data won't change anything for the ECB at this point though. After that, we will get the Spanish, German and Eurozone Q1 GDP reports. These are not going to matter much as the ECB is focused more on inflationary pressures at the moment. The most important report is going to be the Eurozone Flash CPI for April. Headline inflation is expected to 3.0% vs 2.6% prior, but Core CPI is seen unchanged at 2.3%. The ECB has already pre-committed to a rate hold at today's meeting, so the data isn't going to change that, but an increase in core inflation will likely make them even more uncomfortable given the recent jump in inflation expectations. This brings us to the ECB policy decision. The central bank is widely expected to keep the policy rate unchanged at 2.00%. The focus will be on Lagarde and whether she pre-commits to a rate hike in June or pushes back against current market expectations that assign an 80% probability of a rate increase. Given that traders are pricing in a total of 82 bps of tightening by year-end, it's going to be hard for Lagarde to "outhawk" the market, so it's hard to see any lasting upside movement for the euro even if she sounds hawkish and pre-commits to a rate hike in June. Before the ECB, we have the BoE policy decision. The central bank is widely expected to keep the Bank Rate unchanged at 3.75% with one dissenter voting for a rate hike. The economic data has been broadly in line with BoE's projections but the recent PMIs were very hawkish with inflationary pressures hitting records. Traders will be looking for signals of a June hike being on the table or more voters dissenting for a rate hike. The market is pricing in 65% probability of a rate hike in June, so there's some room for the GBP to appreciate on a hawkish hold. AMERICAN SESSION In the American session, we have the US Q1 GDP, the US Employment Cost Index for Q1 and the US Jobless Claims figures. The most important data is going to be the ECI and the Jobless Claims figures. The ECI for Q1 is expected at 0.8% vs 0.7% prior. The Fed watches the data closely as it's the most comprehensive report on wage growth. The only drawback is that it's much less timely than Average Hourly Earnings. Initial Claims are expected at 212K vs 214K prior, while Continuing Claims are seen at 1815K vs 1821K prior. The data has been very good since the start of the year and even showed a re-acceleration in the labour market in the past couple of months. This article was written by Giuseppe Dellamotta at investinglive.com.