Week Ahead: Economic Indicators (2nd June – 6th June) – US
Monday 2nd June
09:45 ET
US S&P Manufacturing PMI May Final
The S&P Global Manufacturing Purchasing Managers’ Index (PMI) is a monthly economic indicator derived from surveys of purchasing managers in the manufacturing sector. It assesses business conditions based on five key components: new orders, output, employment, supplier delivery times, and inventories. A PMI reading above 50 indicates expansion, while a reading below 50 suggests contraction.
Summary of the Latest Report (May Prelim)
Headline PMI: Increased to 52.3 in May from 50.2 in April, marking the highest level in three months and surpassing expectations of 50.1.
New Orders: Experienced the strongest growth in 15 months, indicating rising demand.
Production: Returned to expansion territory after two months of decline.
Inventories: Saw the largest increase since the survey began in 2009, as firms stockpiled in anticipation of potential supply chain disruptions.
Inflationary Pressures: Input prices rose at the fastest pace since November 2022, with businesses passing these costs onto consumers, raising concerns about accelerating inflation.
Employment: Showed a slight decline, reflecting cautious hiring amid cost pressures and demand uncertainties.
What to Expect
US Stocks
The uptick in manufacturing activity suggests economic resilience, which could bolster investor confidence in industrial and manufacturing stocks. However, rising input costs and inflationary pressures may weigh on profit margins, potentially leading to cautious market sentiment.
US Dollar
Stronger manufacturing data typically supports the US dollar, reflecting economic strength. However, concerns about inflation and potential stagflation could introduce volatility, as markets weigh the implications for future monetary policy.
US Government Bonds
Improved manufacturing activity might lead to higher yields, as investors anticipate stronger economic growth. Conversely, heightened inflation fears could increase demand for inflation-protected securities, influencing bond market dynamics.
Federal Reserve Policy
The combination of economic expansion and rising inflation presents a complex scenario for the Federal Reserve. While growth supports maintaining current interest rates, accelerating inflation may prompt discussions on tightening monetary policy to prevent the economy from overheating.
10:00 ET
US ISM Manufacturing PMI for May
The ISM Manufacturing Purchasing Managers’ Index (PMI) is a monthly economic indicator published by the Institute for Supply Management (ISM). It surveys purchasing managers in the manufacturing sector to assess business conditions, including new orders, production, employment, supplier deliveries, and inventories. A PMI reading above 50 indicates expansion in the manufacturing sector, while a reading below 50 signifies contraction.
Summary of the Latest Report (April)
Headline PMI: Decreased to 48.7 in April from 49.0 in March, indicating a contraction in manufacturing activity for the second consecutive month.
New Orders: Rose slightly to 47.2 from 45.2, but remained in contraction territory, suggesting continued weak demand.
Production: Declined sharply to 44.0 from 48.3, reflecting a significant slowdown in manufacturing output.
Employment: Improved modestly to 46.5 from 44.7, yet still indicated job reductions in the sector.
Supplier Deliveries: Increased to 55.2 from 53.5, suggesting slower deliveries, which can be attributed to supply chain disruptions.
Prices: Rose to 69.8 from 69.4, marking the highest level since June 2022, indicating escalating input costs.
Inventories: Decreased to 50.8 from 53.4, showing a slowdown in inventory accumulation.
Backlog of Orders: Dropped to 43.7 from 44.5, indicating a faster contraction in order backlogs.
Exports and Imports: Both contracted, with new export orders falling to 43.1 from 49.6, and imports declining to 47.1 from 50.1.
Overall, the data points to a manufacturing sector facing headwinds from weak demand, supply chain challenges, and rising costs.
What to Expect
US Stocks
The continued contraction in manufacturing activity may weigh on investor sentiment, particularly affecting industrial and manufacturing stocks. However, if other sectors, such as services, show resilience, the broader market impact might be mitigated.
US Dollar
Weak manufacturing data could exert downward pressure on the US dollar, as it may signal a slowing economy and influence expectations of future monetary policy easing.
US Government Bonds
Signs of economic slowdown in the manufacturing sector may lead investors to seek the safety of government bonds, potentially driving yields lower. However, rising input prices could counteract this by increasing inflation expectations, which typically push yields higher.
Federal Reserve Policy
The combination of contracting manufacturing activity and rising input costs presents a dilemma for the Federal Reserve. While economic slowdown might argue for policy easing, escalating prices could necessitate a more cautious approach to avoid fueling inflation.
Tuesday 3rd June
10:00 ET
US Factory Orders for April
The Factory Orders report, published monthly by the U.S. Census Bureau, measures the dollar volume of new orders placed with domestic manufacturers for durable and non-durable goods. It provides insights into the demand for manufactured products and is a key indicator of the health of the manufacturing sector and broader economy.
Summary of the Latest Report (March)
Headline Figure: Factory orders increased by 4.3% in March, following a revised 0.5% rise in February. This marks the largest monthly gain since July of the previous year.
Total Value: New orders for manufactured goods reached $618.8 billion in March.
Durable Goods: Orders for durable goods rose significantly, contributing to the overall increase.
Non-Durable Goods: Orders for non-durable goods also saw an uptick, reflecting broad-based demand across manufacturing sectors.
Influencing Factors: The surge in orders was partly attributed to businesses expediting purchases ahead of anticipated tariff implementations in April.
What to Expect
US Stocks
The robust increase in factory orders suggests strong demand in the manufacturing sector, which could bolster investor confidence and support stock prices, particularly in industrial and manufacturing companies. However, concerns about rising input costs and potential inflationary pressures may temper market enthusiasm.
US Dollar
A significant rise in factory orders indicates economic strength, which can lead to a stronger US dollar as investors anticipate higher interest rates. Nevertheless, if inflation concerns intensify, it could complicate the dollar’s trajectory, depending on the Federal Reserve’s policy response.
US Government Bonds
Stronger factory orders may lead to expectations of increased economic activity and potential inflation, which can result in higher yields and lower bond prices as investors adjust for anticipated rate hikes. Conversely, if the market perceives the surge as temporary or driven by one-off factors like pre-tariff buying, the impact on bonds may be muted.
Federal Reserve Policy
The notable increase in factory orders adds to the evidence of economic momentum, potentially influencing the Federal Reserve to maintain or consider tightening monetary policy to prevent the economy from overheating. However, the Fed will also weigh other factors, such as inflation trends and employment data, before making policy adjustments.
10:00 ET
US JOLTS Job Openings for April
The Job Openings and Labor Turnover Survey (JOLTS) is a monthly report published by the U.S. Bureau of Labor Statistics (BLS). It provides data on job vacancies, hires, and separations (including quits, layoffs, and discharges) across various industries and regions. A job opening is defined as a position that is open (not filled), could start within 30 days, and for which the employer is actively recruiting outside the organization. The JOLTS report is a key indicator of labor market demand and worker mobility.
Summary of the Latest Report (March)
Job Openings: Decreased to 7.2 million in March from a revised 7.5 million in February, indicating a softening in labor demand.
Job Openings Rate: Declined to 4.3% from 4.5% in February, reflecting a lower proportion of job openings relative to total employment.
Hires: Data for March showed a steady pace of hiring, though specific figures were not detailed in the available summary.
Separations: Layoffs and discharges decreased by 222,000 to 1.558 million in March, suggesting employers are retaining workers despite the decline in job openings.
Quits: Remained unchanged at 3.3 million, indicating steady voluntary job separations and suggesting worker confidence in finding new employment.
Overall, the data suggests a cooling in labor demand, with fewer job openings and a stable rate of quits, indicating that while employers are posting fewer jobs, workers remain confident in the labor market.
What to Expect
US Stocks
The decline in job openings may raise concerns about slowing economic growth, potentially leading to increased market volatility. However, the steady rate of quits and decreased layoffs suggest that the labor market remains resilient, which could mitigate negative impacts on stock prices, particularly in sectors sensitive to consumer spending.
US Dollar
A softening labor market, as indicated by fewer job openings, could lead to expectations of a more accommodative monetary policy stance by the Federal Reserve, potentially exerting downward pressure on the US dollar. However, the overall stability in employment may limit significant currency fluctuations.
US Government Bonds
Signs of a cooling labor market may increase demand for government bonds as investors seek safer assets amid economic uncertainty, potentially leading to lower yields. Conversely, if the Federal Reserve signals a pause in rate hikes due to labor market conditions, it could also influence bond market dynamics.
Federal Reserve Policy
The decrease in job openings suggests a potential easing of labor market tightness, which the Federal Reserve may interpret as a sign to pause or slow down interest rate hikes. However, the steady quits rate and reduced layoffs indicate ongoing labor market strength, suggesting that the Fed may adopt a cautious approach, closely monitoring upcoming data before making policy adjustments.
Wednesday 4th June
08:15 ET
US ADP Employment Change for May
The ADP National Employment Report is a monthly economic indicator produced by the ADP Research Institute in collaboration with the Stanford Digital Economy Lab. It measures the change in nonfarm private-sector employment in the United States, based on anonymized payroll data from over 25 million workers. While not directly aligned with the Bureau of Labor Statistics (BLS) data, it offers timely insights into labor market trends.
Summary of the Latest Report (April)
Total Private Jobs Added: 62,000, a significant slowdown from March’s 147,000 and well below the consensus forecast of 115,000.
Sector Performance:
Gains: Leisure and hospitality (+27,000), trade, transportation, and utilities (+21,000), financial activities (+20,000), construction (+16,000), and manufacturing (+4,000).
Losses: Education and health services (-23,000), information (-8,000), and professional and business services (-2,000).
By Business Size:
Small Businesses (1–49 employees): +11,000 jobs.
Medium Businesses (50–499 employees): +40,000 jobs.
Large Businesses (500+ employees): +12,000 jobs.
Wage Growth
Job-Stayers: Annual pay increased by 4.5%.
Job-Changers: Annual pay increased by 6.9%.
Overall, the data indicates a notable deceleration in private-sector hiring, with particular weakness in service-providing industries. The slowdown is attributed to employer caution amid policy and consumer uncertainty.
What to Expect
US Stocks
The weaker-than-expected job growth may dampen investor sentiment, particularly in sectors reliant on consumer spending. However, continued wage growth could provide some support to consumer-driven industries.
US Dollar
A slowdown in employment growth may lead to expectations of a more accommodative monetary policy stance by the Federal Reserve, potentially exerting downward pressure on the US dollar.
US Government Bonds
Signs of a cooling labor market could increase demand for government bonds as investors seek safer assets, potentially leading to lower yields. However, persistent wage growth might counteract this effect by sustaining inflation expectations.
Federal Reserve Policy
The deceleration in job growth, coupled with steady wage increases, presents a mixed picture for the Federal Reserve. While the slowdown may argue for a pause in rate hikes, ongoing wage growth could maintain inflationary pressures, necessitating a cautious approach to monetary policy adjustments.
09:45 ET
Bank of Canada Rate Decision & Rate Statement
The Bank of Canada (BoC) Rate Decision is a scheduled announcement where the central bank sets its target for the overnight rate, influencing borrowing costs across the economy. Accompanying the decision is the Rate Statement, which provides insights into the BoC’s economic outlook and rationale behind its policy stance.
Summary of the Latest Report (April 16th)
On April 16, 2025, the Bank of Canada maintained its target for the overnight rate at 2.75%, with the Bank Rate at 3% and the deposit rate at 2.70%. This decision followed a series of rate cuts earlier in the year, aimed at stimulating economic activity amid global trade uncertainties. Governor Tiff Macklem highlighted that while inflation remained near the BoC’s 2% target, the economic outlook was clouded by potential U.S. tariffs, which could dampen growth and complicate monetary policy decisions.
What to Expect
US Stocks
The BoC’s cautious approach, amid global trade tensions, may signal economic uncertainty, potentially leading to volatility in Canadian stocks and related U.S. equities.
US Dollar
A stable Canadian policy rate, coupled with trade uncertainties, could support the U.S. dollar against the Canadian dollar, especially if investors seek safer assets.
US Government Bonds
The BoC’s dovish stance may influence U.S. bond markets, with potential shifts in investor preferences due to global economic concerns.
Federal Reserve Policy
The Bank of Canada’s policy decisions, especially in response to trade dynamics, may impact the Federal Reserve’s outlook on U.S. monetary policy, considering the interconnectedness of North American economies.
09:45 ET
US S&P Services PMI May Final
The S&P Global US Services Purchasing Managers’ Index (PMI) is a monthly economic indicator that gauges business activity in the U.S. services sector. It is based on surveys of approximately 400 private-sector companies across industries such as finance, insurance, real estate, business services, and information. A reading above 50 indicates expansion, while below 50 signals contraction.
Summary of the Latest Report (May)
In May 2025, the S&P Global US Services PMI rose to 52.3, up from 50.8 in April, indicating a rebound in services sector activity. This improvement was attributed to a temporary easing of trade tensions between the U.S. and China, which boosted business confidence and demand. However, inflationary pressures emerged, with the services output prices index climbing to a two-year high of 58.5, reflecting higher input costs due to tariffs.
What to Expect
US Stocks
The rebound in services sector activity may bolster investor sentiment, particularly benefiting service-oriented companies. However, rising inflation concerns could temper enthusiasm, especially in sectors sensitive to cost pressures.
US Dollar
Stronger services sector performance may support the U.S. dollar, as it suggests economic resilience. Nonetheless, escalating inflation could lead to expectations of tighter monetary policy, which might offset some of the dollar’s gains.
US Government Bonds
Improved business activity could reduce demand for safe-haven government bonds, potentially leading to higher yields. However, persistent inflation concerns might keep bond yields elevated, as investors seek compensation for increased price risks.
Federal Reserve Policy
The Federal Reserve may closely monitor the services sector’s performance and inflation trends. While a rebound in activity is positive, rising input costs could influence the Fed’s decisions on interest rates, balancing economic growth with inflation control.
10:00 ET
US ISM Services PMI for May
The Institute for Supply Management (ISM) Services Purchasing Managers’ Index (PMI) is a monthly economic indicator that measures the economic health of the U.S. services sector. It is based on a survey of purchasing and supply executives across various industries, including finance, insurance, real estate, business services, and information. A reading above 50 indicates expansion in the services sector, while a reading below 50 indicates contraction.
Summary of the Latest Report (April)
In April 2025, the ISM Services PMI increased to 51.6, up from 50.8 in March, indicating a tenth consecutive month of expansion in the services sector. The Business Activity Index registered 53.7, a decrease from March’s 55.9, suggesting a slowdown in growth. The New Orders Index rose to 52.3, up from 50.4, indicating an increase in new business. The Employment Index remained below 50 at 49, signaling a contraction in employment levels. The Prices Index rose to 65.1, up from 60.9, indicating increased inflationary pressures in the services sector.
What to Expect
US Stocks
The slight increase in the Services PMI may provide modest support to service-oriented stocks. However, the rise in inflationary pressures could weigh on investor sentiment, particularly in sectors sensitive to cost increases.
US Dollar
The uptick in the Services PMI could bolster the U.S. dollar, as it suggests resilience in the services sector. However, the rising inflationary pressures may offset some of this positive impact, as investors may anticipate potential monetary policy tightening.
US Government Bonds
The combination of economic expansion and rising inflation could lead to higher yields in the government bond market, as investors demand higher returns to compensate for increased price risks.
Federal Reserve Policy
The Federal Reserve may closely monitor the Services PMI and the accompanying inflation data. While the sustained expansion in the services sector is positive, the rising inflationary pressures could prompt the Fed to consider tightening monetary policy to prevent the economy from overheating.
10:30 ET
US Weekly EIA Crude Oil Inventories
The U.S. Energy Information Administration (EIA) Weekly Petroleum Status Report provides timely data on the supply and disposition of crude oil and petroleum products in the United States. Released every Wednesday, the report includes information on crude oil inventories, production, imports, exports, and refinery activity, offering insights into market dynamics and potential price movements.
Summary of the Latest Report (Week Ending May 16th)
In the week ending May 16, 2025, U.S. commercial crude oil inventories increased by 1.3 million barrels, reaching a total of 443.2 million barrels. This rise was primarily due to a 6-week high in net crude imports, which averaged 2.58 million barrels per day. Despite this increase, crude oil stocks remain approximately 6% below the five-year average for this time of year. Refinery inputs averaged 16.5 million barrels per day, with refineries operating at 90.7% of their operable capacity. Gasoline inventories rose by 816,000 barrels, while distillate stocks increased by 580,000 barrels. However, gasoline demand declined to 8.6 million barrels per day, and the four-week average for distillate demand fell to its lowest since April 2024 at 3.6 million barrels per day.
What to Expect
Crude Oil Prices
The unexpected build in commercial crude oil inventories may exert downward pressure on oil prices, as it suggests a potential oversupply in the market. However, factors such as refinery utilization rates and export levels will also influence price movements.
Energy Sector Stocks
Energy companies, particularly those involved in exploration and production, may experience stock price volatility in response to inventory changes and oil price fluctuations.
Economic Indicators
Changes in crude oil inventories can impact inflation measures and consumer spending, as oil prices influence transportation and production costs across various sectors.
Thursday 5th June
08:30 ET
US Trade Balance for April
The US Trade Balance is the difference between the value of a country’s exports and imports of goods and services. A trade deficit occurs when imports exceed exports, while a trade surplus arises when exports surpass imports. The balance is a crucial indicator of a nation’s economic health, reflecting its international competitiveness and the strength of its currency.
Summary of the Latest Report (March)
In March 2025, the United States recorded a trade deficit of $140.5 billion, marking an increase from the previous month’s deficit of $123.2 billion. This widening gap was primarily due to a significant rise in imports, which outpaced the growth in exports. The deficit in goods expanded by $16.5 billion to $163.5 billion, while the services surplus decreased slightly by $0.8 billion to $23.0 billion. The increase in imports was partly attributed to businesses accelerating purchases ahead of anticipated tariffs, leading to a surge in inventory accumulation.
What to Expect
US Stocks
The widening trade deficit may raise concerns about economic overheating and inflation, potentially leading to increased volatility in the stock market. Sectors reliant on imports or affected by tariffs could experience pressure, while those focused on domestic production might benefit.
US Dollar
A persistent trade deficit can exert downward pressure on the US dollar, as it may signal a weakening demand for the currency in global markets. However, the dollar’s performance will also be influenced by other factors, including interest rates and geopolitical events.
US Government Bonds
Increased trade deficits can lead to higher borrowing needs, potentially pushing up yields on government bonds. Investors may demand higher returns to compensate for perceived risks associated with a growing national debt.
Federal Reserve Policy
The Federal Reserve may closely monitor the trade balance as part of its broader economic assessment. A widening deficit could influence the Fed’s decisions on interest rates and monetary policy, especially if it leads to inflationary pressures or affects economic growth.
08:30 ET
US Weekly Initial & Continued Jobless Claims
The Weekly Initial Jobless Claims report, released every Thursday by the U.S. Department of Labor, indicates the number of new individuals filing for unemployment benefits. This metric serves as a timely gauge of labor market health, with rising claims potentially signaling economic distress and falling claims suggesting economic stability.
Wikipedia
Continued Jobless Claims, reported with a one-week lag, reflect the number of individuals who have been receiving unemployment benefits for more than a week. An increase in continued claims can indicate prolonged unemployment durations, while a decrease may suggest improved job retention.
Summary of the Latest Report (Week Ending May 17TH)
For the week ending May 17, 2025, initial jobless claims decreased by 2,000 to 227,000, indicating a stable labor market. This figure aligns with the consensus forecast and remains within the typical range observed over the past year.
However, continued claims rose by 36,000 to 1.9 million for the week ending May 10. This uptick suggests that while initial layoffs are modest, individuals are experiencing longer durations of unemployment.
The four-week moving average of initial claims increased by 1,000 to 231,500, reflecting a slight upward trend in new filings.
What to Expect
US Stocks
The stable initial claims data may provide modest support to equities, particularly in sectors sensitive to labor market conditions. However, the rise in continued claims could weigh on investor sentiment, especially if it signals potential economic softening.
US Dollar
The mixed labor market signals—steady initial claims paired with rising continued claims—may lead to a cautious outlook for the U.S. dollar. Traders might anticipate that prolonged unemployment could dampen consumer spending, influencing currency valuations.
US Government Bonds
Persistent elevated continued claims could prompt investors to seek the safety of government bonds, potentially driving yields lower. This flight to quality may be further supported by broader economic uncertainties.
Federal Reserve Policy
The Federal Reserve may interpret the divergence between initial and continued claims as indicative of labor market challenges. While initial claims remain low, the increase in continued claims could influence the Fed’s assessment of economic conditions and inform future monetary policy decisions.
Friday 6th June
08:30 ET
US Employment Situation for May
The Employment Situation report, released monthly by the U.S. Bureau of Labor Statistics (BLS), provides comprehensive data on the U.S. labor market. It includes:
Nonfarm Payrolls
The total number of paid workers in the U.S. excluding farm workers, private household employees, and employees of nonprofit organizations.
Unemployment Rate
The percentage of the labor force that is jobless and actively seeking employment.
Average Hourly Earnings
The average amount workers earn per hour, indicating wage inflation and labor market tightness.
These indicators are crucial for assessing economic health, influencing Federal Reserve policy decisions, and guiding investor expectations.
Summary of the Latest Report (April)
In April 2025, the U.S. economy added 177,000 jobs, slightly below the revised 185,000 in March but surpassing expectations of 133,000. The unemployment rate remained steady at 4.2%, consistent with March’s rate. Average hourly earnings increased by 0.2% month-over-month and 3.8% year-over-year, indicating moderate wage growth. Notably, job gains were observed in sectors such as healthcare, transportation, warehousing, and hospitality, while manufacturing experienced a slight decline of 1,000 jobs.
What to Expect
US Stocks
The steady job growth and stable unemployment rate may bolster investor confidence, potentially supporting equity markets. However, the modest wage growth suggests that inflationary pressures remain contained, which could influence sector-specific performance.
US Dollar
The consistent labor market data may provide support for the U.S. dollar, as it reflects economic stability. However, the Federal Reserve’s cautious stance on interest rates, amid ongoing inflation concerns, could temper the dollar’s strength.
US Government Bonds
The combination of steady job growth and moderate wage inflation may lead to a balanced outlook for government bonds. Investors might anticipate stable yields, with the Federal Reserve’s monetary policy decisions playing a pivotal role.
Federal Reserve Policy
The Federal Reserve is likely to maintain a cautious approach to monetary policy. While the labor market shows resilience, the central bank may prioritize controlling inflation over aggressive rate hikes, aiming to sustain economic growth without overheating.
