HomeContributorsFundamental AnalysisWeek Ahead – Turkey Decides, Crucial US Jobs Report, X-Date Fast Approaching

Week Ahead – Turkey Decides, Crucial US Jobs Report, X-Date Fast Approaching


Wall Street is starting to get nervous as we near the X-date.  A US default seemed unimaginable a couple of weeks ago and despite a lot of positive comments from both sides, negotiations will go down to the wire and that means the risk that it falls apart is growing.  Treasury Secretary Yellen will soon provide an update on the X-date and that could show talks might have an extra week from the current June 1st deadline to get a deal done.

Economic data for the week will focus on the labor market, consumer confidence, and ISM manufacturing report.  The US economy is expected to show job growth softened from 230K to 180K in May. Consumer confidence is expected to decline from 101.3 to 99.8 and manufacturing activity is expected to remain in contraction territory.

This week contains a handful of Fed appearances, with Barkin talking about monetary policy on Tuesday, Collins and Bowman attending a Fed Listens event on Wednesday, and Harker speaks twice, once on macroeconomic conditions, and the other time about the economic outlook. The Fed will also release its Beige Book Wednesday. A steady dose of hawkish speak along with solid job growth could make the June FOMC meeting a live one.


Monday is a bank holiday for some countries including Germany and France but the rest of it is filled with economic data and central bank speakers. The standouts on the economic calendar are the flash HICP data on Thursday – which follows individual country inflation numbers earlier in the week – and accounts from the last ECB meeting on the same day. Also on that day, we’ll hear from ECB President Christine Lagarde, which will arguably be more insightful, particularly in light of recent data from the US and UK which showed the economies to be resilient and inflation stubborn. Is that a concern for the ECB and are investors being too optimistic on rates?


The week starts with a bank holiday and it doesn’t really pick up from there. BoE policymakers have been everywhere the last couple of weeks and it seems most are planning a week out of the spotlight which may be no bad thing. The economic data has not delivered what they wanted forcing investors to reluctantly price in four more hikes over the rest of the year. There’s no data of value next week, with the final manufacturing PMI arguably the highlight.


Unemployment is expected to tick higher to 3.6% on Wednesday, up from multi-decade lows of 3.5% and perhaps a sign of a slightly weakening labor market. The manufacturing PMI on Thursday is the only other notable release.

South Africa

A quiet week following the SARB decision on Thursday to hike rates by 50 basis points, taking the repo rate to 8.25%. This came after data on Wednesday showed inflation cooling to 6.8%, just above the 3-6% target range but the central bank warned that the risks remain to the upside.


The run-off Presidential election on Sunday is undoubtedly the highlight of the next week. The lira hit a record low against the dollar on Friday ahead of the vote, with President Erdogan widely expected to emerge victorious after almost clinching 50% of the vote in the first round. The lira could suffer more if the result is confirmed as it means the monetary policy experiment will likely continue. A surprise victory for Kemal Kilicdaroglu could be very interesting on the open, as a potential return to normal policymaking could have a huge impact on the currency. And it would also occur in thin markets with so many countries enjoying the bank holiday break.


An appearance from SNB Chair, Thomas Jordan, on Wednesday will be the highlight next week but we’ll also get GDP data on Tuesday, retail sales on Wednesday and the manufacturing PMI on Thursday. An unusually busy week.


It will be a key PMI week in which the NBS manufacturing and non-manufacturing PMIs for May will be released on Wednesday. Another month of contraction is expected for manufacturing to 49.4, a slight improvement from 49.2 in April. As for services, a dip to 55 is expected from 56.4 in April.

On Thursday, we will have the release of the Caixin manufacturing PMI for May which consists of the coverage of small and medium enterprises. Another month of contraction is expected, slipping to 49.3 from 49.5 in April. If manufacturing and services are lackluster, it will provide further evidence that the growth spurt from China’s re-opening is likely to have disappeared.


A couple of key data to watch. Firstly, Q1 GDP on Wednesday where a 5% year-on-year growth rate is expected, above the 4.4% y/y recorded in Q4 2022.

Next up on Thursday, we will have manufacturing PMI for May, a dip in expansion is expected to 55.8 from 57.2 printed in April. If it turns out as expected, it will be the first growth slowdown after three consecutive months of growth expansion. Lastly, on Friday, bank loan growth for May will be released.


A few data releases to focus on. On Tuesday, building permits for April, 2% month-on-month growth is expected, up from -0.1% in March.

On Wednesday, we will have the monthly CPI indicator for April, which is expected at 6.3%, unchanged from March. On the same day, private sector credit growth for April will be released, with a slight dip to 6.4% from 6.8% in March, expected. If it turns out as forecasted, it will be the sixth consecutive month of a growth slowdown.

On Thursday, retail sales data for April is expected to show zero growth month-on-month from 0.4% in March.

New Zealand

Two key data releases to watch next week. Firstly, ANZ business confidence for May on Wednesday where the consensus forecast is -42 from -43.8 in April. If it turns out as forecasted, it will mark the 23rd consecutive month of negative readings.

Lastly, Q1 terms of trade, export prices, and import prices on Friday. A contraction of 1.8% quarter-on-quarter from 1.8% in Q4 2022 is expected. Export prices are expected to decline further to -2.7% quarter-on-quarter from -0.6% while a slower pace of decline is expected for import prices at -1.3% month-on-month from -2.1%.


On Monday, the unemployment rate for April is expected to improve slightly to 2.7% from 2.8% in March while April’s jobs/applications ratio is expected to hold steady at 1.32.

After an upbeat flash manufacturing and services PMI data for May, the attention for this week will be on retail sales and industrial production data for April, released on Wednesday. Retail sales are expected to record a slight dip to 7% year-on-year from 7.2% in March, while industrial production is expected to increase at a faster rate of 1.5% month-on-month, from 1.1% in March.

On Wednesday, we will have consumer confidence and housing starts. Consumer confidence for May is forecasted to improve to 36 from 35.4 in April. If it turns out as expected, it will be the 4th consecutive of improvement in consumer sentiment. Housing starts for April are expected to improve to -0.9% year-on-year from -3.2% printed in March.

Given that the Nikkei 225 has just hit a 33-year high, it will be paramount to see the amount of stock investment by foreigners and data for the week ending 27 May will be released on Thursday.


Two key data to focus on. Firstly, the PPI for April released on Monday where is forecasted to contract further to -12% year-on-year from -11.3% in March. If it turns out as forecasted, it will mark the fourth consecutive month of contraction.

On Friday, the manufacturing PMI for May is forecasted to improve slightly to 49.9 from 49.7 in April.

Economic Calendar

Saturday, May 27

Economic Events

  • The US could announce an Indo-Pacific Economic Framework, or IPEF, if trade talks are successful with Japan, India, and South Korea

Sunday, May 28

Economic Events

  • Turkish presidential runoff election between incumbent Recep Tayyip Erdogan and Kemal Kilicdaroglu
  • Regional and municipal elections in Spain

Monday, May 29

Economic Events

  • US Memorial Day holiday. Markets and federal offices closed
  • Major European markets also closed for holidays: the UK observes Summer Bank Holiday, Switzerland and Germany closed for Whit Monday

Tuesday, May 30

Economic Data/Events

  • US consumer confidence
  • Australia building approvals
  • Czech Republic GDP
  • Eurozone economic confidence, consumer confidence
  • Japan unemployment
  • Mexico international reserves
  • New Zealand building permits
  • Spain CPI
  • Sweden GDP
  • Switzerland GDP
  • Fed’s Barkin interviewed by NABE VP/Morgan Stanley chief US economist Zentner as part of NABE monetary policy webinar series
  • ECB’s Holzmann speaks at a meeting of the Austrian National Bank and the European Investment Bank
  • EU-US Trade and Technology Council meets in Sweden
  • Panama Canal draft limit becomes effective and will impact the travel of large ships

Wednesday, May 31

Economic Data/Events

  • US job openings, Fed’s Beige Book
  • Canada GDP
  • China manufacturing PMI, non-manufacturing PMI
  • Finland GDP
  • France GDP, CPI
  • Germany CPI, unemployment
  • India GDP
  • Italy GDP, CPI
  • Japan industrial production, retail sales
  • Poland CPI
  • Russia unemployment, industrial production
  • South Africa trade balance
  • Thailand rate decision: BOT expected to raise rates by 25bps to 2.00%
  • Turkey GDP
  • NATO foreign ministers start a two-day meeting in Oslo
  • Fed’s Harker has a fireside chat on the global macroeconomy and monetary conditions at the Official Monetary and Financial Institutions Forum in Philadelphia
  • Fed’s Collins and Bowman give opening remarks at the “Fed Listens” event hosted by Boston Fed
  • ECB issues financial stability review
  • ECB’s Visco presents the bank’s annual report for 2022
  • SNB President Jordan speaks at a monetary policy conference in Lugano, Italy
  • BOE’s Mann speaks at the Pictet Family Forum “Central banks, inflation, monetary policy” in Zurich
  • Hearing on Riksbank monetary policy in Swedish parliament

Thursday, June 1

Economic Data/Events

  • US construction spending, initial jobless claims, ISM Manufacturing, light vehicle sales
  • Tentative X-date (when the US gov’t could run out of cash to pay bills)
  • China Caixin manufacturing PMI
  • ECB Minutes for May 3-4th meeting
  • Eurozone HCOB Eurozone manufacturing PMI, CPI, unemployment
  • France HCOB France manufacturing PMI
  • Germany HCOB Germany manufacturing PMI
  • Hungary GDP
  • India manufacturing PMI
  • Italy unemployment
  • Japan capital spending
  • UK S&P Global / CIPS UK manufacturing PMI
  • ECB President Lagarde and German Finance Minister Lindner speak at German savings banks conference
  • European leaders gather at the second European Political Community meeting in Moldova
  • Fed’s Harker speaks on the economic outlook at NABE’s virtual monetary policy & outlook webinar
  • Sweden’s Riksbank issues report on financial stability
  • BRICS foreign ministers meet in Cape Town
  • DOE crude oil inventories report

Friday, June 2

Economic Data/Events

  • US May Jobs Report: 180Ke v 253K prior; Unemployment Rate: 3.5%e v 3.4% prior; Average hourly earnings M/M: 0.3%e v 0.5% prior
  • France industrial production
  • Mexico unemployment
  • Spain unemployment
  • Possible UK rail strike

Sovereign Rating Updates

  • United Kingdom (Fitch)
  • France (S&P)
  • Finland (Moody’s)
  • Germany (DBRS)
  • United Kingdom (Fitch)
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