- UK services PMI expected to climb back above 50 pts threshold
- Strong EU inflation print may be looming
- NFP forecasted to show wage growth accelerate
The FOMC meeting did not provide much clarity on what looms next. The Federal Reserve is neither likely to raise interest rates nor to cut them. However, the NFP report scheduled for today may be a trigger for bigger price moves on the USD market. Apart from that, GBP and EUR will also be in the spotlight today.
9:30 am BST - UK, Services PMI for April. The Bank of England left rates unchanged but warned that the latest streak of better-than-expected data from the UK economy hints at more rate hikes than currently implied by the yield curve. Apart from that, manufacturing and construction PMIs came in more or less in line with expected. However, it should be noted that the latter climb back above the 50 pts threshold. The final piece of the puzzle - services PMI - will be released today and it is expected to climb above the 50 pts barrier too. Nevertheless, a failure to do so may but the British pound under pressure.
10:00 am BST - Euro area, CPI inflation for April. Inflation reading from the EU member countries released earlier this week showed a major acceleration in the price growth, especially the German data. Having said that, it seems likely that the over EU inflation will accelerate as well. Markets expect a pick-up from 1.4% YoY to 1.6% YoY but upbeat partial data hints at an even faster growth rate.
1:30 pm BST - US, NFP report for April. The US labour market report is the final key reading scheduled for this week. Employment is expected to rise 185k, somewhat lower than the 12-month average. Apart from that, wage growth is seen accelerating from 3.2% YoY to 3.3% YoY. Not the best mix for stocks in case expectations are confirmed. However, higher wage growth may spur inflationary pressures what could give Fed more reasons to be hawkish.
3:00 pm BST - US, ISM non-manufacturing for April. The ISM manufacturing index pulled back in April as was presented by the data release on Wednesday. Non-manufacturing gauge will be released today in the afternoon and it is expected to move slightly higher (from 56.1 pts to 57 pts).
Central bank speakers scheduled for today:
- 9:00 am BST - Bundesbank President Wedimann
- 3:15 pm BST - Fed’s Evans
- 4:30 pm BST - Fed’s Clarida
- 6:45 pm BST - Fed’s Williams
- 8:00 pm BST - Fed’s Bowman
EURUSD keeps trading within a downtrend following a failure to break above the 50-session moving average and downward sloping trendline earlier this week. The pair heads towards the latest swing level but important data releases scheduled for today may spur reversal. Source: xStation5