We see further improvement in ISM manufacturing for April as jobless claimsand regional surveys point to a decent rebound in activity going into Q2. We look foran increase to 54.3 in April from 53.7 driven by a rise in new orders.
Before the ISM release Fed chairman Janet Yellen speaks at 14:30 CET. She islikely to reiterate the soft message from her recent speeches that there is plenty ofslack in the labour market and that inflation is far from the Fed’s target.
US jobless claims are expected to decline slightly to 320k from 329k last week.This would leave the four-week average close to the seven-year low reached over thepast weeks.
Fed’s preferred measure of inflation, core PCE, will be released for March. Inline with consensus we look for a rise of 0.2% m/m. This still leaves the annual ratejust above 1% and far from the Fed’s 2% target.
UK PMI manufacturing has fallen for four months in a row but is still at a decentlevel. It is expected to be broadly unchanged in April at 55.3 (consensus 55.4).
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Danske Bank