US: Busy week ahead from a data perspective - Rabobank

Christian Lawrence, Senior Market Strategist at Rabobank, suggests that it is also set to be a busy week ahead in the US from a data perspective as we kick of today with survey data in the form of the final manufacturing PMI print (53.5 up from 53.4) and we will also see the ISM manufacturing number which is forecast at 57.2, down from 57.7.

Key Quotes

“In terms of activity, the divergence between soft survey data and hard real data remains with animal spirits at play while hard data lags. We will see durable goods tomorrow before the ADP employment report (consensus 195k) and the non-manufacturing services PMI on Wednesday which will help forge expectations for Friday’s labour report. It is an action packed Wednesday given that we will also see the FOMC minutes. That said, given we have already heard from so many Fed speakers since the last meeting, including Kashkari who was the sole dissenting voice, it can be argued that the Minutes are largely historical now. In term of Fed speakers, today we will hear from Dudley, Harker and Lacker. Tarullo tomorrow, Williams on Thursday.”

“Finishing off the week will be the all-important BLS labour report on Friday, the Bloomberg consensus for nonfarm payrolls currently points to a change of 175k in March (235k in February) which would represent a slowdown relative to the start of the year. Construction employment growth was particularly strong in January and February bolstered by warmer weather and this provided a boost that may unwind slightly in March. As usual, we will be paying close attention to the wage growth numbers and here expectations are for a slight downtick in the pace of earnings with growth of 2.7% compared to 2.8% in February. We haven’t seen a print north of 3% here since 2009 and this is unlikely to change in the near term.”

“Finally, as we noted earlier, watch out for continued talk on trade as China’s President Xi will be in Washington on Thursday and Friday.”