Week Ahead: Economic Indicators 3rd – 7th August (US)

Monday 3rd August
09:45 ET
US S&P Manufacturing PMI July Final
The S&P Global Manufacturing Purchasing Managers’ Index (PMI) measures business conditions across the US manufacturing sector through a survey of purchasing managers. It tracks output, new orders, employment, inventories, supplier delivery times, and prices. A reading above 50 indicates expansion, while a reading below 50 signals contraction. The final release updates the preliminary estimate with additional survey responses and is used to confirm the health of the manufacturing sector.

Summary of Last Report
In the previous report (July Preliminary), the Manufacturing PMI remained firmly in expansion territory, although it eased slightly from June and came in below market expectations.
The report showed:
The headline Manufacturing PMI edged down to 53.8 from 53.9, remaining close to its highest level in more than four years.
Manufacturing output and new orders continued to expand, pointing to ongoing resilience in factory activity despite elevated borrowing costs.
Input costs and selling prices accelerated, with businesses reporting the strongest increase in selling prices in nearly four years, highlighting persistent inflationary pressures.
Overall, the preliminary report suggested that US manufacturing remained resilient, although firms continued to face elevated cost pressures even as growth moderated slightly.

What to Expect
US Stocks
If the final July PMI is revised higher, particularly through stronger output and new orders, it would reinforce confidence in the manufacturing sector and could support industrials, materials, and broader cyclical stocks. A downward revision may weigh modestly on equities by suggesting softer manufacturing momentum.
US Dollar
A stronger final reading would likely support the dollar by reinforcing confidence in the resilience of the US economy. A weaker revision could pressure the dollar if markets view it as evidence that growth is beginning to moderate.
US Government Bond Yields
Treasury yields could move higher if the report confirms strong manufacturing activity and persistent price pressures. Conversely, a weaker revision, particularly if price components ease, would likely support lower yields.
Federal Reserve Policy
While the final PMI typically generates less market impact than the preliminary release, policymakers will continue to monitor both the pace of manufacturing activity and the survey’s price components. Confirmation of resilient growth alongside elevated input and output prices would support a higher-for-longer policy stance, while softer activity and easing inflation pressures would strengthen the case for a more accommodative policy path.

10:00 ET
US ISM Manufacturing PMI for July
The Institute for Supply Management (ISM) Manufacturing PMI measures business conditions across the US manufacturing sector through a monthly survey of purchasing managers. It tracks new orders, production, employment, supplier deliveries, and inventories, with a reading above 50 indicating expansion and below 50 indicating contraction. Markets also closely watch the report’s Prices Paid and New Orders components for clues on inflation and future manufacturing activity.

Summary of Last Report
In the previous report (June), the ISM Manufacturing PMI remained in contraction territory for a fourth consecutive month, although the pace of contraction eased slightly.
The report showed:
The headline PMI improved modestly, suggesting manufacturing activity was stabilising but had yet to return to expansion.
Production and new orders remained below 50, indicating demand across the sector was still subdued.
The Prices Paid Index increased, signalling that input cost pressures persisted despite softer overall activity.
The Employment Index remained in contraction, reflecting continued caution among manufacturers regarding hiring.
Overall, the June report suggested the manufacturing sector remained under pressure, although there were tentative signs that the downturn was beginning to moderate.

What to Expect
US Stocks
A stronger-than-expected July PMI, particularly if it moves back above 50 or shows improvement in new orders, would likely support equities, especially industrials, materials, and other cyclical sectors. A weaker reading could weigh on stocks by reinforcing concerns about slowing manufacturing activity.
US Dollar
An upside surprise would likely support the dollar by reinforcing confidence in the resilience of the US economy. A weaker-than-expected report may pressure the dollar as markets price a softer growth outlook.
US Government Bond Yields
Treasury yields could move higher if the PMI points to stronger manufacturing activity and firm price pressures. Conversely, a weaker report, particularly if accompanied by softer Prices Paid, would likely push yields lower as investors increase expectations for future policy easing.
Federal Reserve Policy
The Fed will focus not only on the headline PMI but also on the New Orders and Prices Paid components. A rebound in activity alongside persistent input cost pressures would support a higher-for-longer policy stance. If manufacturing remains weak and inflation pressures continue to ease, it would strengthen the case for a more accommodative policy path.

Tuesday 4th August
08:30 ET
US Trade Balance for June
The US International Trade in Goods and Services report measures the difference between the value of US exports and imports. A trade deficit occurs when imports exceed exports, while a trade surplus occurs when exports exceed imports. The report provides insight into global demand for US goods and services, domestic consumption, and trade’s contribution to GDP. Markets also monitor the separate goods and services balances for trends in international trade.

Summary of Last Report
In the previous report (May), the US trade deficit narrowed sharply, reflecting a decline in imports following earlier front-loading of purchases, while exports remained relatively resilient.
The report showed:
Imports declined, led by a pullback in consumer goods and industrial supplies after previous tariff-related front-loading.
Exports remained broadly stable, supported by continued demand for industrial supplies, capital goods, and services.
The narrower trade deficit suggested that net exports were likely to provide a positive contribution to second-quarter GDP growth.
Overall, the report pointed to an improving trade position, with the sharp narrowing in the deficit expected to support overall economic growth during Q2.

What to Expect
US Stocks
The trade balance typically has a limited direct impact on equities, but a narrower-than-expected deficit could support sentiment by signalling stronger net exports and economic growth. A wider deficit may weigh modestly on cyclical sectors if it reflects weaker external demand or stronger import growth.
US Dollar
A smaller trade deficit would generally be supportive of the dollar by suggesting stronger external demand for US goods and services. A wider-than-expected deficit could pressure the dollar if it points to softer export demand or increased reliance on imports.
US Government Bond Yields
A narrower deficit that reinforces expectations for stronger GDP growth could push Treasury yields higher. Conversely, a wider deficit may support lower yields if it signals weaker economic momentum.
Federal Reserve Policy
The Federal Reserve does not target the trade balance directly, but it will monitor the report as part of its broader assessment of economic activity. If the June data confirms that net exports made a meaningful positive contribution to Q2 GDP, it would support a higher-for-longer policy stance by reinforcing the resilience of the US economy. A wider deficit that detracts from growth would strengthen the case for a more accommodative policy path if accompanied by broader signs of slowing demand.

10:00 ET
US JOLTS Job Openings for June
The Job Openings and Labor Turnover Survey (JOLTS), published monthly by the Bureau of Labor Statistics, measures labour demand across the US economy. While the headline Job Openings figure receives the most attention, markets also closely monitor the Hires, Quits, and Layoffs and Discharges rates. The report provides valuable insight into labour market tightness and is closely watched by the Federal Reserve as an indicator of wage pressures and overall employment conditions.

Summary of Last Report
In the previous report (May), job openings were little changed at 7.6 million, suggesting labour demand remained stable despite signs that the employment market was gradually cooling.
The report showed:
Job openings were essentially unchanged, indicating employers continued to seek workers but were becoming more selective in their hiring.
The quits rate held at 1.9%, suggesting workers remained cautious about voluntarily leaving their jobs for new opportunities.
Hires were broadly unchanged, while the layoffs and discharges rate ticked slightly higher but remained low by historical standards, pointing to a labour market that was cooling gradually rather than deteriorating.
Overall, the report suggested the US labour market remained resilient but continued to move toward better balance, with demand for workers easing from previous highs without a significant increase in layoffs.

What to Expect
US Stocks
A moderate decline in job openings would likely be viewed positively by equity markets if it signals continued labour market normalisation without a sharp deterioration in employment. However, a much weaker-than-expected reading could raise concerns that economic growth is slowing more rapidly than anticipated.
US Dollar
A stronger-than-expected JOLTS report, particularly if job openings rise and the quits rate improves, would likely support the dollar by reinforcing confidence in the resilience of the labour market. A weaker report could pressure the dollar by increasing expectations for a more accommodative Federal Reserve policy path.
US Government Bond Yields
Treasury yields would likely rise if job openings remain elevated, signalling continued labour market tightness and persistent wage pressures. Conversely, a softer report, particularly if accompanied by fewer openings and a lower quits rate, would likely pull yields lower as investors price in reduced inflationary pressures.
Federal Reserve Policy
The Federal Reserve will focus on whether labour demand continues to ease in an orderly fashion. A gradual decline in job openings alongside low layoffs would support the view that the labour market is rebalancing without a significant deterioration, potentially allowing for a more accommodative policy path over time. If job openings unexpectedly rebound, it would reinforce a higher-for-longer stance by suggesting labour market tightness and wage pressures remain persistent.

Wednesaday 5th August
08:15 ET
US ADP Employment Change for July
The ADP National Employment Report measures the monthly change in private-sector employment using anonymised payroll data from more than 26 million US workers. Released two days before the official Employment Situation Report, it provides an early snapshot of labour market conditions. While the ADP report does not consistently predict the official nonfarm payrolls figure, it is closely watched for signals on hiring trends and labour demand.

Summary of Last Report
In the previous report (June), private-sector employment increased by 98,000, down from 122,000 in May and below economists’ expectations, pointing to a moderation in hiring.
The report showed:
Private payrolls increased by 98,000, marking the slowest pace of job creation in three months.
Education and health services led hiring, while financial activities and trade, transportation and utilities also posted solid gains.
Hiring remained uneven across sectors, with some industries continuing to face labour supply constraints despite softer overall demand.
Overall, the report suggested the labour market remained resilient but continued to cool gradually, with hiring slowing to a pace more consistent with a moderating economy rather than a sharp deterioration.

What to Expect
US Stocks
A moderate payroll gain would likely be viewed positively if it points to a gradual cooling in the labour market without signalling a significant slowdown in economic activity. A much stronger reading could revive concerns that the labour market remains too tight, while a sharp downside surprise may weigh on equities by increasing fears of weaker growth.
US Dollar
A stronger-than-expected ADP report would likely support the dollar by reinforcing confidence in the resilience of the US economy. A weaker reading could pressure the dollar as markets increase expectations for a more accommodative Federal Reserve policy path.
US Government Bond Yields
Treasury yields would likely rise if hiring proves stronger than expected, suggesting labour demand remains robust. Conversely, softer payroll growth would likely pull yields lower as investors price a reduced risk of persistent wage-driven inflation.
Federal Reserve Policy
While the Federal Reserve places greater emphasis on the official Employment Situation Report than the ADP release, the report still provides an important indication of labour market momentum. Continued moderation in hiring would support the view that employment conditions are gradually rebalancing, strengthening the case for a more accommodative policy path over time. A stronger-than-expected rebound in private hiring would reinforce a higher-for-longer stance by suggesting labour demand remains resilient.

09:45 ET
US S&P Services PMI July Final
The S&P Global Services Purchasing Managers’ Index (PMI) measures business conditions across the US services sector, which accounts for the majority of US economic activity. The survey tracks business activity, new orders, employment, backlogs of work, and prices. A reading above 50 indicates expansion, while a reading below 50 signals contraction. The final release updates the preliminary estimate with additional survey responses and helps confirm the health of the services sector.

Summary of Last Report
In the previous report (July Preliminary), the Services PMI remained firmly in expansion territory, continuing to point to resilient activity across the US services sector despite signs of moderating growth.
The report showed:
The headline Services PMI eased slightly from June but remained comfortably above the 50 expansion threshold.
Business activity and new orders continued to grow, reflecting solid demand across much of the services economy.
Employment increased, although firms reported ongoing challenges in filling some positions.
Input costs and output prices remained elevated, indicating that inflationary pressures in the services sector persisted despite broader signs of disinflation.
Overall, the preliminary report suggested the services sector continued to support overall US economic growth, with activity remaining resilient even as businesses faced ongoing cost pressures.

What to Expect
US Stocks
If the final July reading confirms resilient services activity, it would support equities, particularly consumer discretionary, financials, and other domestically focused sectors. A downward revision could weigh modestly on sentiment by suggesting economic momentum is easing.
US Dollar
A stronger final reading would likely support the dollar by reinforcing confidence in the resilience of the US economy. A weaker revision could pressure the dollar if it points to softer domestic demand.
US Government Bond Yields
Treasury yields could move higher if the report confirms strong business activity and persistent price pressures. Conversely, a weaker revision, particularly if price components are revised lower, would likely support lower yields.
Federal Reserve Policy
The Federal Reserve will pay close attention to both the pace of services activity and the survey’s inflation measures. Confirmation of strong demand alongside elevated price pressures would support a higher-for-longer policy stance. If the final report shows softer activity and easing inflation pressures, it would strengthen the case for a more accommodative policy path over time.

10:00 ET
US ISM Services PMI for July
The Institute for Supply Management (ISM) Services PMI measures business conditions across the US services sector, which accounts for around three-quarters of US economic activity. The survey tracks business activity, new orders, employment, supplier deliveries, and prices, with a reading above 50 indicating expansion and below 50 indicating contraction. Markets pay particularly close attention to the Business Activity, Employment, and Prices Paid components for signals on economic momentum and inflation.

Summary of Last Report
In the previous report (June), the ISM Services PMI remained firmly in expansion territory at 54.0, marking the 24th consecutive month of growth, although activity cooled slightly from May.
The report showed:
The headline Services PMI edged down to 54.0 from 54.5, indicating the services sector continued to expand at a solid pace.
The Business Activity and New Orders indexes both remained comfortably in expansion territory despite easing from the previous month, signalling demand remained healthy.
The Employment Index returned to expansion for the first time in four months, suggesting hiring conditions improved across the sector.
The Prices Paid Index declined to 67.7 from 71.3, its lowest level since February, although it remained elevated and continued to point to significant cost pressures.
Overall, the June report suggested the US services sector remained a key source of economic strength, with healthy demand and improving employment offset by persistent, though moderating, inflationary pressures.

What to Expect
US Stocks
A stronger-than-expected July reading, particularly if business activity and new orders improve, would likely support equities by reinforcing confidence in the US economy. A weaker report could weigh on sentiment if it suggests the largest part of the economy is beginning to lose momentum.
US Dollar
A stronger ISM Services PMI would likely support the dollar by reinforcing expectations of resilient economic growth. A softer-than-expected reading could pressure the dollar if it increases expectations for a more accommodative Federal Reserve policy path.
US Government Bond Yields
Treasury yields would likely rise if the report points to stronger services activity and persistent price pressures. Conversely, weaker activity or a notable decline in the Prices Paid Index would likely support lower yields.
Federal Reserve Policy
The Federal Reserve will focus closely on the Business Activity, Employment, and Prices Paid components. Continued strength in activity alongside elevated price pressures would support a higher-for-longer policy stance. If the report points to slowing demand and easing inflationary pressures, it would strengthen the case for a more accommodative policy path over time.

Thursday 6th August
No noteworthy economic indicators

Friday 7th August
08:30 ET
US Employment Situation for July
The Employment Situation Report is the most closely watched monthly indicator of the US labour market and one of the most market-moving economic releases. It combines data from two Bureau of Labor Statistics surveys to provide a comprehensive picture of employment conditions. The report’s key components are Nonfarm Payrolls (NFP), which measures the monthly change in employment excluding the farming sector, the Unemployment Rate, which measures the percentage of the labour force actively seeking work but unable to find it, and Average Hourly Earnings, a key gauge of wage growth and inflationary pressure.

Summary of Last Report
In the previous report (June), the US labour market slowed noticeably, with hiring falling well short of expectations, although the unemployment rate edged lower as labour force participation declined. Wage growth remained steady, suggesting underlying labour market conditions were cooling but not deteriorating sharply.
The report showed:
Nonfarm payrolls increased by 57,000, the weakest monthly gain in several months, while prior months were revised lower.
The unemployment rate fell to 4.2% from 4.3%, though the decline was largely driven by a drop in labour force participation rather than stronger hiring.
Average Hourly Earnings rose 0.3% on the month and 3.5% from a year earlier, indicating wage growth remained moderate despite softer job creation.
Labour market conditions pointed to a low-hire, low-fire environment, with employers remaining cautious about adding staff while layoffs stayed historically low.
Overall, the June report suggested the labour market continued to cool gradually rather than weaken abruptly, with softer hiring offset by still-resilient wage growth and relatively low unemployment.

What to Expect
US Stocks
A balanced report, with payroll growth close to expectations, stable unemployment, and moderate wage growth, would likely be the most supportive outcome for equities. Exceptionally strong job gains or faster wage growth could raise concerns that the Federal Reserve will keep policy restrictive for longer, while a much weaker report could weigh on stocks by increasing fears of an economic slowdown.
US Dollar
A stronger-than-expected employment report, particularly if accompanied by firm wage growth, would likely support the dollar by reinforcing confidence in the resilience of the US economy. Conversely, weaker payroll growth, rising unemployment, or softer earnings would likely pressure the dollar as markets increase expectations for a more accommodative Federal Reserve policy path.
US Government Bond Yields
Treasury yields would likely rise following stronger payroll growth and robust wage gains, as investors price greater inflationary pressure and a more restrictive Fed outlook. A weaker report, particularly if unemployment rises and wage growth slows, would likely push yields lower.
Federal Reserve Policy
The Employment Situation Report remains one of the Federal Reserve’s most important inputs when assessing progress toward maximum employment and price stability. Policymakers will focus not only on the headline payroll figure, but also on the unemployment rate, labour force participation, revisions to prior months, and wage growth. A resilient labour market with persistent wage pressures would support a higher-for-longer policy stance. Conversely, evidence of slowing hiring, rising labour market slack, and easing wage growth would strengthen the case for a more accommodative policy path.

08:30 ET
Canadian Employment Change for July
The Canadian Labour Force Survey measures employment conditions across the Canadian economy and is one of the Bank of Canada’s most closely watched economic releases. The report includes Employment Change, the Unemployment Rate, Labour Force Participation, and Average Hourly Wages. Employment Change measures the net number of jobs gained or lost during the month and provides an important gauge of labour market momentum.

Summary of Last Report
In the previous report (June), the Canadian labour market remained broadly stable, with employment posting a modest increase while the unemployment rate edged lower.
The report showed:
Employment increased by 18,000, following a much stronger gain of 88,000 in May, indicating hiring had moderated but remained positive.
The unemployment rate declined to 6.5% from 6.6%, marking the first decrease since January as employment growth outpaced labour force growth.
Employment gains were concentrated among youth and core-aged workers, while employment among those aged 55 and over declined. Accommodation and food services led job creation, whereas manufacturing employment fell.
Average hourly wages rose 3.3% year-over-year, up from 3.0% in May, suggesting wage growth remained firm despite a cooling labour market.
Overall, the June report suggested the Canadian labour market was stabilising after a volatile start to the year, with modest job growth, lower unemployment, and steady wage gains supporting the view that conditions remained resilient despite ongoing weakness in some sectors.

What to Expect
Canadian Stocks
A stronger-than-expected employment report would likely support Canadian equities by reinforcing confidence in domestic economic growth, particularly for banks, consumer discretionary companies, and other economically sensitive sectors. A weaker report could weigh on sentiment if it raises concerns about slowing economic activity.
Canadian Dollar
A stronger employment gain, lower unemployment, or firmer wage growth would likely support the Canadian dollar by reducing expectations for Bank of Canada policy easing. Conversely, weaker employment data would likely pressure the loonie.
Canadian Government Bond Yields
Canadian government bond yields would likely rise if employment growth surprises to the upside and wage pressures remain firm. A weaker report, particularly if accompanied by rising unemployment or slowing wage growth, would likely push yields lower.
Bank of Canada Policy
The Bank of Canada will focus on the overall balance of the labour market, including employment growth, the unemployment rate, participation, and wage growth. Continued resilience in hiring and wages would support a higher-for-longer policy stance by suggesting underlying economic strength remains intact. Conversely, softer employment growth, rising labour market slack, and easing wage pressures would strengthen the case for a more accommodative policy path.