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The U.S. housing market reports and a sequence of U.K. inflation and consumer spending data will make the trading week ahead an interesting one for the GBP/USD currency pair which has not been able to break outside of its range since October, 2011.

In preparation for the new trading week, here is a list of the Top 10 spotlight economic events that will move the markets around the globe.

1. GBP- U.K. CPI- Consumer Price Index, the main measure of inflation preferred by the Bank of England, Tues., Mar. 20, 5:30 am, ET.

In line with the Bank of England’s forecast, inflationary pressures in the U.K. have been subsiding in recent months and this trend is expected to continue with the consumer price index declining to 3.4% y/y in February from 3.6% y/y in January. However, despite of the consensus forecasts, it would not be surprising to see inflation picking up as a result of rising energy costs.

2. USD- U.S. Housing Starts and Building Permits, a leading indicator of housing market activity measuring construction of new residential properties Tues., Mar. 20, 8:30 am, ET.

The U.S. housing reports throughout the week are not expected to deliver anything spectacular. First in line will be the housing starts which are forecast to stay at 700K in February, same as the January reading, while the building permits inch higher to 690K from 680K in the previous month.

3. GBP- Bank of England Monetary Policy Committee Meeting Minutes, Wed., Mar. 21, 5:30 am, ET.

After deciding at its February meeting to expand the size of the Asset Purchases Program by another 50 billion pounds, the Bank of England should maintain the status quo at least until the second half of 2012 and the minutes should confirm these expectations. With the current expansion already fully priced in and the potential for inflation to get back on the bank’s radar screen, the odds will be reduced that the Bank of England could opt for additional quantitative easing in the near future. The GBP should benefit from a shift towards less accommodative monetary policy by the U.K. central bank.

4. USD- U.S. Existing Home Sales, the main gauge of the condition of the U.S. housing market measuring the number of closed sales of previously constructed homes, condominiums and co-ops, Wed., Mar. 21, 10:00 am, ET.

Lagging behind the improvement in other sectors, sales of existing homes in the U.S. are forecast to increase slightly to 4.6 million in February, compared with 4.57 million in the previous month.

5. JPY- Japan Trade Balance of the difference between imports and exports, Wed., Mar. 21, 7:50 pm, ET.

Taking a breather from the trend of rising trade deficit, although still far from the desired surplus, the Japanese trade balance report might instill some optimism as the deficit declines to a reading of -340 billion yen in February from -610 billion in the previous month. A better-than-expected report could help the yen to correct some of its recent losses on a decreased probability that the Bank of Japan will be forced to go beyond the recently announced 10 trillion expansion of the bank’s funds for asset purchases as a tool to stimulate the economy and to weaken the yen.

6. EUR- Euro-zone Manufacturing and Services PMI- Purchasing Managers Indexes, two leading indicators of economic conditions measuring activity in the manufacturing and services sectors, Thurs., Mar. 22, 5:00 am, ET.

The preliminary estimates of these two important gauges of future economic conditions could bring some hope that the Euro-zone might be on its way out of a double dip with the manufacturing index forecast to increase to 49.6 from 49.0 and the service index climbing to 49.3 from 48.8. Although they could improve, it is important to note that both indexes are forecast to stay below 50, stuck in contraction territory for another month.

7. GBP- U.K. Retail Sales, an important gauge of consumer spending measuring sales at retail establishments, Thurs., Mar. 22, 5:30 am, ET.

A potential risk event for the GBP, the U.K. retail sales are forecast to drop by 0.5% m/m in February after rising by 0.9% in the previous month.

8. USD- U.S. Jobless Claims, an important gauge of labor market conditions measuring first-time claims for unemployment benefits, Thurs., Mar. 22, 8:30 am, ET.

Following the previous week’s decline by 14K to 351K, the first-time claims for unemployment benefits could bounce a bit higher to 353K, but still should remain below 375K- the number estimated by economists to signal consistent improvement in labor market conditions and further decline in the unemployment rate.

9. CAD- Canada CPI- Consumer Price Index, the main measure of inflation preferred by the Bank of Canada, Fri., Mar. 23, 7:00 am, ET.

With oil prices on the rise, the Canadian inflation gauge could inch higher by 0.5% m/m in February from 0.4% m/m in January. On the other hand, it is not very likely that the increase in inflationary pressures at this point would be enough to prompt the Bank of Canada to consider lifting the benchmark interest rate. The strengthening of the U.S. economy and higher oil prices, however, should continue to be supportive factors for the Canadian dollar.

10. USD- U.S. New Home Sales, an important gauge of housing market activity measuring sales of newly constructed homes, Fri., Mar. 23, 10:00 am, ET.

Similar to the existing home sales, new home purchases are also expected to register a small increase to 327K in February, compared with 321K in the previous month.

Source: Trading Week Outlook: March 19 - 23