Expectations and commentary over recent data.
Expectations over next week's macroeconomic data and commentary over recent macroeconomic data releases.
United States:
The good news is that the United States can avert a government default before the deadline is reached; it's in the hands of Congress, and when passed, the United States will continue its current path. Thus far, employment data has been strong, which allows monetary policy to be focused on price stability instead of maximum employment. As inflation lowers and the United States leads the deflationary trend compared to Europe and the United Kingdom.
Current ISM Manufacturing PMI:
Expected ISM Manufacturing PMI:
48
The ISM Manufacturing PMI is an index that measures the change in production levels in the United States economy. It indicates the level of demand for products by measuring the amount of ordering activity at the nation's factories in the Manufacturing sector. Which can show if the monetary policy tightening path is working or not, because the change shows the variation in demand.
The Job Openings and Labor Turnover Survey (JOLTS) Data.
Expected Job Openings and Labor Turnover Survey (JOLTS):
9.35MLN
The Job Openings and Labor Turnover Survey (JOLTS) data is essential to identify changes in the job market, given the fact that this data shows the change in job openings, hires, quits, layoffs, and discharges. Which can show if the monetary policy tightening path is working or not, because the change shows if the tightening path is harming the job market or not.
The ADP Employment Change Data.
Current ADP Employment Change:
Expected ADP Employment Change:
+200K
The ADP Employment data shows the change in employment data all over the United States’ private sector. The variation in it shows the strength of the private sector job market. Which can show if the monetary policy tightening path is working or not, because the change shows if the tightening path is harming the job market or not.
Current Non Farm Payrolls (NFP):
Expected Non Farm Payrolls (NFP):
+240K
The Non Farm Payroll data shows the change in employment data all over the United States; the variation in it shows the strength of the job market. Which can show if the monetary policy tightening path is working or not, because the change shows if the tightening path is harming the job market or not.
Current Unemployment Rate:
Expected Unemployment Rate:
3.4%
The Unemployment Rate data shows the change in employment data all over the United States; the variation of it shows the strength of the job market. Which can show if the monetary policy tightening path is working or not, because the change shows if the tightening path is harming the job market or not.
Current Participation Rate :
Expected Participation Rate :
62.6%
The Participation Rate data shows the change in employment supply data all over the United States; the variation of it shows the strength of the United States economy, the higher the Participation Rate is, the higher the number of people either working or looking for work. Which can show if the monetary policy tightening path is working or not, because the change shows if the tightening path is harming the job market or not.
Conference Board (CB) Consumer Confidence Data.
Expected Conference Board (CB) Consumer Confidence:
103
The Conference Board (CB) Consumer Confidence data shows the change in economic activity, detailing the current conditions and likely developments based on consumer attitudes, buying intentions, vacation plans, and expectations over inflation, market prices, and interest rates.
Expectations for the United States economy remain the same. Celebrate Memorial Day by honoring the ones who fought for your freedom.
Europe:
Depending on the data, the European Central Bank should tighten monetary policy above market expectations or not. If the inflation data shows bad surprises like the United Kingdom's Core Inflation data, market reaction should be the same as in the United Kingdom's markets.
Current Consumer Price Index :
Year over Year: 7.0%
Month over Month: 0.6%
Expected Consumer Price Index :
Year over Year: 6.5%
Month over Month: 0.4%
The change in the Consumer Price Index Data shows the rate at which the currency depreciates due to the rise in goods costs due to de-equilibriums between supply and demand. Which can show if the monetary policy tightening path is working or not, because the change shows if the monetary policy tightening path is lowering inflation by decreasing demand-side inflationary pressures or not.
Core Consumer Price Index Data.
Current Core Consumer Price Index:
Year over Year: 5.6%
Expected Core Consumer Price Index:
Year over Year: 5.5%
The change in the Core Consumer Price Index Data shows the rate at which the currency depreciates due to the rise in goods costs due to de-equilibriums between supply and demand. The Core Consumer Price Items basket reflects price changes in non-price-volatile items, i.e., good prices excluding food and energy prices. The variation in the data can show if the monetary policy tightening path is working or not because the change shows if the tightening path is lowering inflation by decreasing demand-side inflationary pressures or not. The higher the Core Consumer Price Index Data is, the tighter monetary policy has to be.
If there are no bad surprises in the inflation data, market reaction to the data is expected to be a 1.5 to 2 sigma move.
United Kingdom:
Recent inflation data in the United Kingdom showed a higher core inflation rate and a lower non-core inflation rate, with core inflation reaching its highest level since 1992. This has been the main vector of recent price action in the Gilt bond market as markets reprice the forward rate hike path of the Bank of England.
Current Manufacturing PMI :
46.9
Expected Manufacturing PMI :
47.9
Manufacturing PMI is an index that measures the change in production levels in the United Kingdom economy. It indicates the level of demand for products by measuring the amount of ordering activity at the nation's factories in the Manufacturing sector. Which can show if the monetary policy measures are working or not, because the change shows the variation in demand.
The Manufacturing PMI data should give a hint as to whether recent recession fears come true or not. A good thing to point out is that the IMF no longer expects a recession in the United Kingdom. Overall expectations for the UK economy remain the same, as government measures have helped to lower some but not all inflationary pressures, and monetary policy measures have contributed to lower non-core prices by lowering demand-side inflationary pressures through interest rates. The effect of globalism in markets has also contributed to lower non-core inflation prices in the United Kingdom, given measures taken in the United States.
Asia:
China:
Recent Chinese employment data alarmed markets as some employment statistics hit record highs and not in a good way, thus shifting market expectations over China’s monetary policy. As China’s recovery from the pandemic depends on data, the People's Bank of China is expected to act towards ensuring a steady recovery, which is what markets expect.
Current China Manufacturing PMI:
49.2
Expected China Manufacturing PMI:
50.1
The China Manufacturing PMI is an index that measures the change in production levels in the Chinese economy. It indicates the level of demand for products by measuring the amount of ordering activity at the nation's factories in the manufacturing sector.
The China Manufacturing PMI data will also give a hint about China's recovery, and the expected market reaction to the data is expected to be a 2 sigma move.
Japan:
Recent commentaries by Bank of Japan Governor Ueda suggested a plausible monetary policy change as Japanese prices, excluding energy and fresh food, a gauge of the underlying inflation trend, rose at the fastest pace since 1982.
Current Unemployment Rate :
2.8%
Expected Unemployment Rate :
2.7%
The Unemployment Rate Data shows the change in employment data all over Japan; the variation of it shows the strength of the job market and consequently the status of the economy.
Japan's PM Fumio's statements in January have generated a big spike in wages, which has contrarested inflationary pressures, but wage-price spiral risks remain. Overall, the Japanese economy behaves way stronger than expected, despite the Japanese currency devaluation and the Japanese inflation rate. Thus, expectations remain the same.
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