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Markets focused on US interest rate outlook - BoE member due to speak.

It seems set to be a relatively quiet day in Europe. There are no data releases of note in the UK. In the Eurozone there will be the second reading of April CPI inflation. However, that is likely to unchanged from the initial estimate, which showed slowdowns in both ‘core’ and ‘headline’ annual inflation compared to March. ECB President Draghi is speaking at a conference today but he seems unlikely to talk about the immediate policy outlook.

Sterling was provided only brief support from strong UK labour market data yesterday. With no UK data releases of note today, markets will be focused on comments from policymakers. In an interview in the Daily Telegraph today, Bank of England rate-setter Broadbent expressed concerns about weak productivity growth and warned that the BoE would not “spoon feed” markets with forward guidance.

In the US, industrial production is expected to have risen in April for the third month in a row. This partly reflects a pickup in activity in the oil sector in response to the surge in oil prices but manufacturing output is also growing strongly and is now more than 3% higher than a year ago.