Week Ahead: Sharp rebound for US durable goods, sentiment and PMIs on the up

There’s plenty on the economic calendar this week to keep markets busy even in the (unlikely) event the headlines are quiet. Confidence data from Europe, PMIs from across the world, and some key US goods orders and spending figures will help to shape our understanding of the continuing impact of Covid-19 and the trajectory of the recovery. 

Eurozone consumer, business confidence surveys

The latest sentiment data from Germany and the Eurozone as a whole will be closely watched. The easing of lockdown restrictions and the reopening of more businesses is expected to help both business and consumer sentiment to improve, although it goes without saying that overall both groups are still highly pessimistic. 

The flash Eurozone consumer confidence reading for June is expected to improve to -16 from -18.8 in May. Germany’s Ifo Business Climate index is forecast to hit 85.1 – up from 79.5 previously, while the GfK consumer measure is expected to print at -12 for July after the -18.9 reading recorded for June. 

Flash PMIs to help shape expectations for Q2 GDP

Tuesday brings a deluge of flash services and manufacturing PMIs. The latest figures are due from the Eurozone, the UK, and the US. Although subject to revision, the latest numbers will help to refine expectations for those all-important Q2 GDP numbers. 

Sharp increases are expected across the board, as reopening economies help slow the tumble in services in particular. 

US durable goods orders to rebound

Having recently seen a huge jump in employment and retail sales that shattered expectations, it seems likely this week’s US durable goods orders data will show a strong rebound too. 

Like most data, orders had collapsed over the past couple of months at a rate not seen in years. The reopening of the US economy and improving prospects for some consumers and businesses is likely to translate into a sharp rebound. Analysts expect to see orders jump 7.1%, although as with all rebounds after a sharp drop, there will still be a long way to go before we’re back to pre-crisis levels. 

Unemployment claims are also due on Thursday. The consensus is for another slowdown in claims growth, with a further 1.3 million new claims expected. This would mark the first time since the record 6.86 million jump recorded in the last full week of March that new weekly claims have been below 1.5 million. 

US personal spending to climb on easing restrictions, higher employment

Personal income surged in April, recording a 10.5% leap thanks to government relief programmes, although this didn’t translate to increased consumer outlay, with spending dropping -13.6%. Consumers stashed this extra cash, with the savings rate up 33% on the previous month. 

Incomes are expected to have fallen -5% in May without the help of so much government relief, while spending is forecast up 3%.

Highlights on XRay this Week 

Read the full schedule of financial market analysis and training.

07.15 UTC Daily European Morning Call
17.00 UTC 22-Jun Reading Candlestick Charts: Trading Patterns and Trends
From 15.30 UTC 23-Jun Weekly Gold, Silver, and Oil Forecasts
17.00 UTC 23-Jun Introduction to Currency Trading – Is it For Me?
14.45 UTC 25-June Master the Market with Andrew Barnett

 

Key Events this Week

Watch out for the biggest events on the economic calendar this week:

14.00 UTC 22-Jun Eurozone Flash Consumer Confidence
07.15 UTC 23-Jun Eurozone/ DE/ FR Flash Services, Manufacturing PMIs
08.30 UTC 23-Jun UK Flash Manufacturing/Services PMIs
13.45 UTC 23-Jun US Flash Manfacturing/Services PMI
03.00 UTC 24-Jun RBNZ Interest Rate Decision
08.00 UTC 24-Jun German ifo Business Climate
14.30 UTC 24-Jun US EIA Crude Oil Inventories
06.00 UTC 25-Jun German GfK Consumer Climate
12.30 UTC 25-Jun US Durable Goods Orders
00.30 UTC 25-Jun US Unemployment Claims
14.30 UTC 25-Jun US EIA Natural Gas Storage
Pre-Market 25-Jun Accenture Plc – Q3 2020, McCormick & Co – Q2 2020
12.30 UTC 26-Jun US PCE, Personal Spending, Personal Income
14.00 UTC 26-Jun Revised University of Michigan Sentiment Index