3 Numbers: Eurozone Deflation To Ease, U.S. Store Sales, ISM Services
James Picerno | May 05, 2015 01:50AM ET
The forecast that deflation risk is receding in Europe is on track for another dose of supporting evidence in today’s release on producer prices. Meanwhile, the case for a second-quarter rebound in the US is in focus again with the release of weekly store sales data via the Redbook Index and the April report for the ISM Non-Manufacturing Index.
advised in last week's economic bulletin. “The decline observed over the previous two years has thus come to a halt.”
In that case, today’s PPI release should provide a fresh round of support for the central bank’s outlook.
current estimate for GDP growth in the April-through-June period, for instance, is 0.8%. That’s up from the virtually flat 0.2% gain in the first quarter, but as revivals go the latest number looks fairly tepid.
The Blue Chip consensus view for the second quarter is considerably higher — in the low-3% range. But this source turned out to be far too optimistic for the first quarter. In short, the Atlanta Federal Reserve’s nowcast for weak growth remains a compelling counterpoint at the moment to the upbeat estimates found elsewhere.
Then again, if the second-quarter growth rate is due for upward revisions in the weeks ahead, perhaps we will see a clue in today’s Redbook release.
13:45 GMT ) is on track for something similar via a fractional down-tick compared with last week's flash data.
Overall, the numbers on tap for today’s review of the services sector are expected to report a solid rate of growth. But with a mixed bag of data generally so far for April’s macro profile, today’s releases won’t convince the skeptics to dismiss the worry that the US economy is struggling to right itself after a disappointing first quarter.
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Disclosure: Originally published at Saxo Bank TradingFloor.com
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