A whole series of factors are expected to converge to produce a sharp monthly fall in consumer prices for January, data which are due out on Thursday. The influence of falling mortgage interest rates, largely responsible for falls in the index in November and December will still play a part as the final rate reductions in the run-up to euro convergence come into play.
In addition, there is the effect of the winter sales which last year accounted for a 0.6 per cent fall in the index in January. Analysts are pencilling in a similar contribution this year. Other areas contributing to a fall in the index may be fuel, where prices are still under downward pressure, and phone calls, where the effects of deregulation of the residential phone market at the end of last year may be beginning to be felt. On the upside, little is expected although the capacity of the food sector to surprise cannot be entirely discounted. Forecasts from ABN Amro are for a monthly fall of 0.9 per cent, producing an annual inflation rate of 1.4 per cent.
Lloyds TSB: After all the recent excitement of the rumoured imminent takeover of AIB by Lloyds TSB that wasn't, attention this week will focus on the altogether more real performance by the British bank in the past year. The giant group, which announces its finals on Friday, will be closely watched for the performance of its mortgage subsidiary Cheltenham & Gloucester.
Northern Rock last week indicated that it was being squeezed by pricing pressures in the competitive sector and Cheltenham & Gloucester is expected to report similar problems.
Analysts have pencilled in profit forecasts of £3.05 billion sterling (€4.43 billion) before tax.
Monday
Results: Commerzbank, Dassault Systemes, IAF Group (H1), Metallgesellschaft (Q1), PizzaExpress (H1), Roxspur (H1).
A.G.M.: Century Inns, Europower (e.g.m.).
Meetings: EU finance ministers (Brussels); Group of 10 central bank governors hold regular monthly meeting at Bank for International Settlements (Basle); Mr Denis O'Brien, chairman of Esat Telecom addresses Sales INstitute of Ireland members on "The Role of Professional Selling in Entrepreneurship" (Burlington Hotel, Dublin).
Indicators: British industrial production (Dec), manufacturing output (Dec) and producer price index (Jan); German industrial production (Dec).
Others: Results of Irish Association of Investment Managers retail funds survey on the levels and trends of personal assets held by private investors published; British supermarket group Safeway issues Christmas trading statement; OECD Development Co-operation 1998 Report published (Paris).
Tuesday
Results: Alumasc Group (H1), BOC (Q1), British Airways (Q3), Epic Group (H1), Gartmore British and Growth, Grolsch, Henderson TR Pacific, ICC Bank, Reuters, Ryanair (Q3), Stoves (H1).
Indicators: Irish agricultural output, input and income (1998); British CBI regional trends survey (Feb) retail consortium sales monitor (Jan) and construction new orders (Dec); US productivity (Q4) and unit labour costs (Q4); Japanese household spending (Dec); German unemployment (Jan).
Others: French Finance Ministry sets price for fixed-price offer for Air France.
Wednesday
Results: BSkyB (H1), JSB Software (H1), Scot American, Trelleborg.
A.G.M.: Carlton Communications, Eurocamp, Heal's, Helical Bar (e.g.m.), IOC International, National Building Materials (e.g.m.), SEC Group, United Drug, Windsor.
Indicators: Bank of England publishes quarterly inflation report; US wholesale trade (Dec); Japanese machinery orders (Dec); German current account (Dec) and trade balance (Dec).
Others: NCB report on housing market; German government financial committee meets to discuss tax reforms; Small Firms Association introduces its Y2K project "Bugwatch 2000 by MInister of State for Technology, Mr Noel Treacy.
Thursday
Results: Armitage Brothers (H1), Britannia Smaller, British Telecommunications (Q3), Bull, Inn Business Group, Royal Dutch/Shell, RPS Group, Volvo.
A.G.M.: Airtours, Greencore Group, L&G Recovery, Metroline, Transtec, Warner Estate Holdings.
Indicators: Irish consumer price index (Jan); US retail sales (Jan), Chicago Federal Index (Dec) and weekly jobs and monetary data.
Others: Government tables Finance Bill in the Dail; US Federal Reserve chairman Mr Alan Greenspan testifies before the House Banking Committee on plans to reform Depression-era laws separating banking and commerce
Friday
Results: Lloyds TSB, Outokumpu, Torex, Viag.
A.G.M.: Burndene Investments.
Indicators: British machine tools (Dec); US business inventories (Dec), import/export prices (Jan) and Atlanta Federal Index (Jan); French current account (Nov) and official reserves (Jan); Italian industrial orders (Nov)
