The corporate diary is pretty bare but there is plenty on the macro front to look forward to. Here’s our look ahead at some of the biggest events for the markets this week:

US Nonfarm Payrolls

 

Jobs growth bounced back in April following a pretty lacklustre performance in March, stiffening expectations that the Federal Reserve faces few obstacles to raising rates at its June meeting.

With the FOMC convening in a fortnight’s time for that crunch decision, Friday’s nonfarm payrolls (NFP) will be as closely watched as ever for clues about how strong the US economy appears.

Weighing on any positivity in the report are renewed doubts about the reflationary policies of president Trump, which has forced two of the biggest investment banks to trim their bond yield forecasts for 2018. Nevertheless, the monthly NFP release should provide all the usual volatility in US Treasuries, the dollar and equity markets. The private ADP nonfarm report on Wednesday will also be keenly awaited as it can give clues about the official data release two days’ later.

German inflation

 

The German powerhouse rumbles on. Germany business confidence hit a record high last week amid signs of a welcome surge in activity in the Eurozone’s largest economy. Attention this week shifts to inflation figures, with German CPI data released on Tuesday, followed by flash inflation estimates for the Eurozone on Wednesday.

The inflation data will be watched especially closely by euro traders as it comes shortly before the European Central Bank’s meeting next week. Rising inflation and growth, combined with receding political risk, is putting pressure on the ECB to consider tightening monetary policy faster than planned. Investors are already acting, with EURUSD climbing to multi-month highs in recent days. A big spike in underlying CPI inflation could send the euro higher if the ECB does seem minded to act.

UK economy

 

The upcoming General Election is likely to offer continued interest for traders as sterling flirts with an eight-month high around $1.30. Recent polls showing a Labour surge suggest Theresa May’s Conservative party might not be a shoo-in for a thumping majority. If Labour continues to narrow the gap expect heightened volatility in sterling pairs, with the pound exposed to political risks associated with Brexit negotiations set to start just a week after the June 8th poll.

Meanwhile, the monthly series of PMI reports will provide more clarity about the pace of growth in the economy amid signs that the pace of expansion may be slowing. Manufacturing and construction surveys are due out on Thursday and Friday respectively, with the all-important services sector report coming the following Monday.

 

Economic Calendar

(All times BST)

Monday, 29 May

All Day – Bank holiday in US and UK (stock market closed, see updated trading hours here)

Tuesday, 30 May

00:30 – Japan unemployment rate, household spending

08:00 – Spanish flash CPI inflation

12:00 – German preliminary CPI inflation

13:30 – US core PCE price index, personal spending

15:00 – US CB consumer confidence

22:00 – RBNZ financial stability report

Wednesday, 31 May

00:01 – UK BRC shop price index, GfK consumer confidence

00:50 – Japan preliminary industrial production

02:00 – China manufacturing and non-manufacturing PMIs

07:45 – French preliminary CPI inflation

08:55 – German unemployment rate

09:30 – UK net lending to individuals

10:00 – Eurozone CPI flash estimates

13:30 – Canada GDP rate

14:45 – US Chicago PMI

15:00 – US pending home sales

Thursday, 1 June

02:30 – Australia private capital expenditure, retail sales

02:45 – China Caixin manufacturing PMI

08:15 – Spanish manufacturing PMI

08:55 – German final manufacturing PMI

09:00 – Eurozone final manufacturing PMI

09:30 – UK manufacturing PMI

13:15 – US ADP nonfarm employment change

13:30 – US weekly unemployment claims

15:00 – US ISM manufacturing PMI

16:00 – US crude oil inventories

Friday, 2 June

08:00 – Spain unemployment change

09:30 – UK construction PMI

13:30 – Canada trade balance, labour productivity

13:30 – US nonfarm payrolls, unemployment rate, average hourly earnings, trade balance

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