MNI Global Week Ahead May 24 – 28

Key Things to Watch:

• Tuesday, May 25 – German IFO
  • The headline Ifo business climate indicator is expected to rise to a two-year high of 98.1 in May, marking a fourth consecutive increase.
  • Company assessments of the current situation are expected to improve further to 95.5, hitting the highest level since the start of the pandemic. Expectations eased slightly in April due to concerns over a third wave of infections and bottlenecks in intermediate products. In May, markets are looking for a renewed uptick to 101.0.
  • Vaccinations are gaining momentum with around 38% of the population having been vaccinated at least once. However, survey evidence suggests that supply chain issues persist, which is likely to weigh on the outlook.

• Thursday, May 27 – U.S. Jobless Claims
  • U.S. jobless claims filed through May 22 are set to dip to 425,000 from 444,000 through May 15, a new pandemic low, according to the Bloomberg consensus. Initial claims should continue to trend downward as the economy opens through the summer and hiring improves.
  • Analysts say both initial and continuing claims could see a sharp decline in mid-June, when many states plan to opt out of enhanced federal UI benefits.

• Friday, May 28 – U.S. Personal Income
  • U.S. personal income is set to have fallen sharply in April, with markets expecting a decline of 14.8% following March's strong 21.1% gain, according to Bloomberg, mostly reflecting the fading effect of stimulus checks.
  • Meanwhile, personal spending in April should continue to improve. Spending on goods stumbled in April, evidenced by last week's retail sales numbers, but services spending is seen improving as businesses continue to reopen and widely available vaccines make in-person activities safer.