Week Ahead: Economic Indicators 25th – 29th May (US)

Monday 25th May
US Market Holiday: Memorial Day
No noteworthy economic indicators

Tuesday 26th May
10:00 ET
US CB Consumer Confidence for May
The Conference Board Consumer Confidence Index (CCI) measures US households’ perceptions of current economic conditions and expectations for the next six months. The survey is split into the Present Situation Index and the Expectations Index, with the latter often viewed as a leading indicator of economic momentum. As consumer spending accounts for roughly 70% of US GDP, this release is closely watched for signals on demand and growth.

Summary of Last Report
In the previous report (April), consumer confidence rose modestly to 92.8 from 92.2, marking a third consecutive monthly increase and beating expectations.
Beneath the headline, the details were more mixed:
The Present Situation Index slipped slightly
Expectations improved modestly, helped by resilient labour-market conditions and stronger equity markets
Consumers remained concerned about inflation, particularly rising energy prices and broader geopolitical uncertainty
Overall, the report suggested that the US consumer remained reasonably resilient, though confidence was still historically subdued relative to periods of strong economic growth.

What to Expect
US Stocks
A stronger-than-expected May reading, particularly if expectations improve further, could support equities, especially consumer discretionary and retail sectors, as confidence underpins spending.
A weaker-than-expected print may weigh on stocks, signaling softer household demand and growing economic caution.
US Dollar
Improving confidence typically supports the dollar, as it reinforces growth resilience and reduces expectations for near-term Fed easing.
A disappointing reading may pressure the dollar, with markets leaning toward a more dovish policy outlook.
US Government Bond Yields
Stronger confidence can push yields higher, reflecting firmer growth expectations and reduced safe-haven demand.
Weaker confidence generally leads to lower yields, as investors price in slower consumption and increased odds of policy accommodation.
Federal Reserve Policy
Improved consumer confidence would reduce pressure on the Fed to ease policy quickly, supporting a patient or higher-for-longer stance.
A meaningful deterioration in sentiment, especially in the expectations component, would strengthen the case for a more accommodative policy path if it signals softer demand ahead.

Wednesday 27th May
No noteworthy economic indicators

Thursday 28th May
08:30 ET
US PCE Price Index & Consumer Spending for April
The Personal Consumption Expenditures (PCE) Price Index, published monthly by the US Bureau of Economic Analysis, measures changes in prices paid by consumers for goods and services. It is the Federal Reserve’s preferred inflation gauge because it captures a broad range of spending and adjusts for changes in consumer behavior. The release also includes consumer spending, which tracks household outlays across goods and services and is a key driver of US economic growth.

Summary of Last Report
In the previous report (March), the PCE Price Index rose 0.7% month-over-month and 3.5% year-over-year, accelerating sharply from February. The move was largely driven by higher energy prices, while core PCE rose 0.3% MoM and 3.2% YoY, showing underlying inflation remained firm.
Consumer spending also strengthened, with personal consumption expenditures rising 0.9% month-over-month, supported by higher services spending and energy-related outlays. Real spending increased more modestly, suggesting part of the headline gain reflected higher prices rather than stronger underlying demand.
Overall, the report pointed to renewed headline inflation pressure, mainly from energy, while consumer spending remained resilient but increasingly affected by higher prices.

What to Expect
US Stocks
A cooler-than-expected April PCE print, especially in core inflation, could support equities by easing concerns about sticky inflation and improving the outlook for rate-sensitive sectors.
A hotter reading, particularly if paired with strong spending, may weigh on stocks as markets price in tighter financial conditions for longer.
US Dollar
Stronger inflation or firmer spending would likely support the dollar, as both reduce expectations for near-term Fed easing.
A softer inflation print and weaker spending outcome may pressure the dollar, with markets leaning toward a more dovish policy outlook.
US Government Bond Yields
Higher-than-expected PCE inflation would likely push yields higher, especially if core inflation remains firm.
A softer report would likely pull yields lower, as investors price in reduced inflation pressure and a more accommodative Fed path.
Federal Reserve Policy
A firm core PCE reading, combined with resilient spending, would support a higher-for-longer Fed stance and keep policymakers cautious about cutting rates too quickly.
If inflation cools and spending softens, it would strengthen the case for a more accommodative policy path later in the year.

08:30 ET
US GDP Q1 Second Estimate
Gross Domestic Product (GDP), published by the US Bureau of Economic Analysis, measures the total value of goods and services produced in the economy. The quarter-on-quarter annualised GDP figure is the broadest indicator of US economic growth. The second estimate incorporates more complete data than the advance release, including updated figures on trade, inventories, consumer spending, and business investment.

Summary of Last Report
In the previous report (Q1 Advance), US GDP showed soft but positive growth, suggesting the economy slowed from the prior quarter but avoided outright contraction. Consumer spending remained the main support, while trade and inventories were more mixed. Business investment showed uneven momentum, and higher prices continued to complicate the growth picture.
Overall, the report pointed to an economy that was still expanding, but losing momentum, with demand holding up better than some forward-looking indicators had suggested.

What to Expect
US Stocks
If the second estimate revises growth higher, equities may benefit as stronger activity supports earnings expectations and reduces recession concerns.
A downward revision could weigh on stocks, especially cyclicals, if it signals weaker consumer spending or softer business investment.
US Dollar
An upward revision would likely support the dollar, reinforcing confidence in US economic resilience and reducing expectations for near-term Fed easing.
A weaker revision may pressure the dollar as markets reassess growth momentum and lean toward a more dovish policy outlook.
US Government Bond Yields
Stronger growth revisions could push yields higher, reflecting firmer economic activity and potentially more persistent inflation pressures.
Downward revisions typically lead to lower yields, as investors price in softer growth and increased odds of policy accommodation.
Federal Reserve Policy
A stronger second estimate would reduce pressure on the Fed to ease policy quickly, supporting a patient or higher-for-longer stance.
A weaker revision, particularly if driven by softer consumption or investment, would strengthen the case for a more accommodative policy path as growth risks build.

Friday 29th May
No noteworthy economic indicators