The FOMC meeting tonight should provide few surprises as the Fed tapersanother USD10bn of asset purchases. There will be no press conference or newprojections and the statement is expected to have been changed very little. We lookfor the Fed to acknowledge the recent improvement in data but at the same time keepthe current very soft tone on inflation
On the data front we have a packed day with many releases out of both the euro-areaand the US. Spanish inflation is released at 09:00 CET followed by Euro flashinflation at 11:00 CET. After German inflation surprised to the downside yesterdaywe have revised down our estimate for euro inflation from 0.8% to 0.7% for April.
Spanish GDP may also receive some attention this morning. We look for a rise of0.4% q/q, which would mark the biggest increase since 2008.
In the US April ADP employment will give some input to the rebound inemployment following the bad weather. Consensus looks for 210k but we see someupside risk following strong data recently.
We look for US GDP for Q1 to have risen 1.0% q/q AR (consensus 1.2% q/q AR).Growth in Q1 was held back by weak consumption and soft housing partly related tothe bad weather, as well as a reduction in the contribution from inventories. ChicagoPMI for April is expected to increase slightly to 57.0 from 55.9 after five monthsof decline.
Norway releases unemployment, retail sales and industrial confidence today.
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Danske Bank