After last week's key event, the retail sales number, which the market discounted as being too unrealistic (and overly seasonally adjusted) after printing at a 13 month high and attempting to refute the reality observed by countless retailers, this week has a quiet start today with no data of note due out of Europe and just Empire manufacturing (which moments ago missed badly) and the NAHB housing market index of note in the US session this morning.
In Asia tomorrow the RBA meeting minutes may be of interest given the cut earlier this month, while Japan will also release industrial production data for May. In Europe we’ll get the April inflation docket for the UK (CPI/RPI/PPI) where headline consumer price inflation is expected to have risen +0.3% mom. We’ll also get the Euro area trade balance while in the US it’s a big day for data on Tuesday with April CPI (+0.4% mom headline expected, +0.2% mom at the core), housing starts and building permits as well as industrial and manufacturing production.
Moving to Wednesday, the big overnight data is the Q1 GDP report out of Japan, while later on in the morning we will get April property prices data for China. In Europe on Wednesday the main focus is on the Euro area CPI report (0.0% mom headline expected) while in the UK the latest employment report is due out. There’s no data out in the US on Wednesday but we will get the FOMC minutes from the April meeting.
Thursday’s focus in the morning is on the UK again where the April retail sales print is due, before we then get the ECB minutes around lunchtime which will be of interest. Datawise in the US on Thursday we’ve got the Chicago Fed national activity index, Philly Fed PMI, initial jobless claims and the Conference Board’s leading indicators.
It’s a quiet end to the week on Friday. In Europe the only data of note is the German PPI reading, while in the US existing home sales data is due out.
In terms of the Fedspeak this week we’ve got Kashkari scheduled to speak late this evening, followed by Williams, Lockhart and Kaplan tomorrow evening and Dudley on Thursday. Over at the ECB we will hear from Praet, Nouy and Costa all tomorrow. Finally, earnings season draws pretty much to a conclusion with just 23 S&P 500 companies set to report with some of the retailers the bigger interest including Target, Home Depot, Lowe’s, Wal-Mart and Staples. In Europe we’ll hear form 27 Stoxx 600 companies including Vodafone and Merck.
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A complete breakdown of just the US via Goldman:
Monday, May 16
- 08:30 AM Empire Manufacturing, May (consensus +6.5, last +9.6) - Consensus expects a slight correction in the Empire Manufacturing survey, which jumped in March and April. The stabilization of most manufacturing surveys in April after the rebound in March from depressed levels suggests that US manufacturing has turned a corner and is now expanding at a moderate pace.
- 10:00 AM NAHB Housing Market Index, April (consensus 59, last 58) - The NAHB homebuilders’ index—which we have found to be a decent leading indicator of housing starts—has been flat for the last 3 months, but remains near its post-crisis highs.
- 7:00 PM Minneapolis Fed President Kashkari (FOMC non-voter) speaks - Federal Reserve Bank of Minneapolis President Neel Kashkari will be hosting a town hall meeting about the banking sector and financial stability at the University of Minnesota. Recently, President Kashkari has suggested the Fed is unlikely to aggressively raise interest rates.
Tuesday, May 17
- 08:30 AM CPI (mom), April (GS +0.33%, consensus +0.3%, last +0.1%); Core CPI (mom), April (GS +0.13%, consensus +0.2%, last +0.1%); CPI (yoy), April (GS +1.1%, consensus +1.1%, last +0.9%); Core CPI (yoy), April (GS +2.1%, consensus +2.1%, last +2.2%) - We expect that core CPI rose by 0.13% in April, following a smaller than expected 0.07% gain in March. Airline fares are likely to decline sharply in the April print, in part due to seasonal adjustment challenges. On a year-on-year basis, core CPI likely rose by 2.1%. We estimate headline consumer prices rose by 0.33% last month as retail gasoline prices moved higher. On a year-on-year basis the headline index likely increased by 1.1%.
- 08:30 AM Housing starts, April (GS +3.3%, consensus +3.3%, last -8.8%); Building permits, April (consensus +5.5%, last -8.6%) - We expect that housing starts rose by 3.3% in April following an 8.8% decline in March. Starts and permits softened in Q1 and point to an annualized construction rate of 1,150k. Our credit strategy analysts point out that the construction slowdown in oil-producing regions may be playing an important role.
- 9:15 AM Industrial production, April (GS +0.4%, consensus +0.3%, last -0.6%); Manufacturing production, April (GS +0.4%, consensus +0.3%, last -0.3%); Capacity utilization, April (GS 75.0%, consensus 75.0%, last 74.8%) - We expect that industrial production increased by +0.4% in April. IP has been soft of late, mostly due to low utilities demand in a warmer than usual winter. We expect the manufacturing recovery to continue.
- 12:00 PM San Francisco Fed President John Williams (FOMC non-voter) and Atlanta Fed President Dennis Lockhart (FOMC non-voter) Speak -
- San Francisco Fed President John Williams and Atlanta Fed President Dennis Lockhart will discuss the future of the US economy at a Politico event in Washington, D.C. Last week, President Williams said that two to three rate increases this year still make sense. Two weeks ago, President Lockhart said that the possibility of a June rate hike should be kept open.
- 1:15 PM Dallas Fed President Kaplan (FOMC non-voter) speaks - Federal Reserve Bank of Dallas President Robert Kaplan will speak at a moderated Q&A session followed by media availability at a community forum hosted by the Dallas Fed in Midland, Texas. Two weeks ago, President Kaplan said that he would advocate further rate hikes in June or July if the second-quarter data, especially consumer spending, are stronger and if continued progress is made on the dual mandate.
Wednesday, May 18
- 02:00 PM Minutes from the April 26-27 FOMC meeting - The April FOMC meeting statement indicated less concern about financial market volatility and weakness in global growth, and left open the possibility of a rate hike in June. In the minutes, we will be watching for (1) any additional signs that the committee has seen a meaningful decline in risks from global economic and financial developments, (2) further hints on the interpretation of the omission of the balance of risks, and (3) any views regarding the outlook for core inflation.
Thursday, May 19
- 08:30 AM Initial jobless claims, week ended May 14 (consensus 275k, last 294k); Continuing jobless claims, week ended May 7 (consensus 2,165k, last 2,161k) - Consensus expects initial jobless claims to edge down to 275k. Initial claims moved up last week, although we suspect that nearly all of the increase was attributable to seasonal distortions specific to New York State.
- 08:30 AM Philadelphia Fed manufacturing index, May (GS +3.0, consensus +3.0, last -1.6) - We expect the Philly Fed manufacturing index to edge up after a significant decline last month.
- 10:30 AM New York Fed President Dudley (FOMC voter) speaks - Federal Reserve Bank of New York President William Dudley will deliver remarks on macroeconomic trends at a New York Fed event followed by a Q&A session.
Friday, May 20
- 10:00 AM Existing Home Sales, April (consensus +1.3%, last +5.1%)- April existing home sales probably increased slightly, according to the consensus view. Existing home sales are an input into the brokers' commissions component of residential investment in the GDP report.
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Finally, a handy summary of key events from BofA:
Source: DB, Goldman, BofA