A look at the day ahead from Dhara Ranasinghe. All eyes today on Russia, where the central bank is expected to raise its 5% interest rate by as much as 50 basis points -- its third rate rise in a row.
The rouble faces risks from geo-politics and more importantly, inflation is running above-target.
Russia, like many emerging markets, is seeking to get ahead of the Federal Reserve, which has stressed it will look past any temporary rise in inflation and keep stimulus in place. That message helped markets take in their stride Thursday's blowout U.S. CPI print of 5%.
Despite that number, U.S. Treasury yields are at three-month lows and down 12 basis points this week -- set for their biggest weekly drop in a year. Stock markets too are keeping their faith in the Fed for now, with MSCI's world stock index up. European and U.S. equity futures are higher too.
UK markets have reason to cheer as well -- Britain's economic output in April was a record 27.6% larger than 12 months before, data showed.
Meanwhile, leaders of the Group of Seven wealthiest economies meet in the English seaside resort of Carbis Bay. In Joe Biden's first G7 meeting, the U.S. President faces lingering doubts about America's reliability as a partner.
Leaders from the G7, NATO and the European Union are worried about the pendulum of U.S. politics swinging yet again, and are looking for concrete action, not words after the shock of the Trump years.
Quite active on the corporate front too -- Didi Chuxing, China's biggest ride-hailing firm made public the filing for its long-anticipated U.S. stock market listing which is expected to be this year's biggest initial public offering.
Key developments that should provide more direction to markets on Friday:
- UK April industrial output up 27.5%
- US Uni of Michigan inflation expectations
- G7 summit in Cornwall
- German Bundesbank sees 2021 inflation at 2.6% vs 1.6% before
(Reporting by Dhara Ranasinghe; editing by Sujata Rao)