The key event will be the US employment report for April (14:30 CET). We lookfor a solid rise of 220k in non-farm payrolls, which is in line with the consensusestimate of 218k (note that the consensus estimate has moved higher during theweek). A number of indicators has pointed to a solid rebound in activity in March andApril (personal spending, ISM, industrial production) and this is expected to bereflected in payrolls as well. The unemployment rate will also be important. Weexpect a small decline from 6.7% to 6.6%. Judging from the Fed’s own projectionsthe first hike will be delivered when the unemployment rate is around 6%, althoughthe timing will also depend on inflation and the strength of growth.
Unemployment is due for release in the euro area (11:00 CET) as well, although itwill hardly draw as much attention. The unemployment rate is expected to be flat at11.9% with some downside risk given the recent strong PMI data.
Final euro PMIs for April will give more country details, including PMIs inSpain and Italy (released 09:15 and 09:45 CET respectively). We expect increasesin both countries.
At 12:00 CET ECB announces the weekly repayment of the three-year LTROmoney.
In Scandinavia focus will be on PMI in Norway and Sweden and currencyreserve data in Denmark.
Read the full report: FX Daily
Danske Bank