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US Cr Mkt Wk Ahead: May Retail Sales, CPI, Trade, Fed Blackout

     CHICAGO (MNI) - Consumer-data highlights for the week ahead include May
Retail Sales, CPI, PPI.
     No added insight on policy from the Fed after last week's weaker than
expected private ADP and non-farm employ data as they entered their blackout
period early Saturday June 8 (runs through June 20).
     Friday's data saw the probability of a rate cut at the next FOMC (June
18-19) climb over 40% while a cut at the July meet (July 30-31) surged to just
under 90%.
     JP Morgan economists "expect there will be some Fed officials who argue for
an ease at the upcoming June 18-19 FOMC meeting. And not without reason: growth
is slowing, trade risks are rising, and inflation threats are absent. Even so,
we think the most likely outcome of that debate is to adopt a watchful waiting
     JPM said they are "still look for cuts in September and December, though
risks are skewing toward sooner and more."
     Aside from upcoming data, markets will be keeping a close eye on global
trade after the the U.S. reached a deal with Mexico late Friday, suspending
indefinitely the imminent threat of higher tariffs on Mexico. 
     Questions remain on how the U.S. will measure the success of Mexico's
efforts to bolster their borders. Meanwhile trade negotiations with China and
Europe are ongoing. Reminder, the next G20 summit will be held in Osaka, Japan
on June 28-29.
     U.S. Treasury auctions include 13- and 26W bills on Monday, 3-, 10- and 30s
on Tuesday through Thursday respectively.
     Salient data highlights (estimates):
     - Monday: April JOLTS job openings/quits rate; May Employment Trends Index
(ETI); June NY Fed expectations survey.
     Nomura economists "expect some slowdown in upcoming JOLTS data, consistent
with slowing labor market momentum. Job openings in March rebounded strongly to
7488k, up 346k, after a sharp decline in February to 7142k, consistent with the
rebound in overall labor market activity during the month."
     - Tuesday: PPI; Redbook retail sales; June IBD/TIPP Optimism Index; May
Kansas City Fed LMCI.
     Barclays economists "forecast final demand PPI to have increased 0.1% m/m
and 1.9% y/y in May. We also expect core PPI excluding food and energy to have
increased by 0.2% m/m and 2.3% y/y. Headline PPI inflation slowed at the end of
last year as a result of the weakness in energy prices, but those negative base
effects have dissipated in recent months providing a tailwind to headline PPI."
     - Wednesday: CPI; June Atlanta Fed inflation; May Treasury budget balance.
     Morgan Stanley economists said "Core CPI has printed a series of moderate
readings, rising just 0.14%M and 0.15%M in March and April, respectively. The
weakness in the recent readings have been driven by large declines in core goods
prices, which dropped 0.21%M in March and 0.34%M in April. However, we expect a
slight rebound in core goods in May (+0.05%M), which should come alongside
another robust reading in core services (+0.27%M after +0.29%M in April)."
     - Thursday: Weekly claims; May import/export prices. 
     Barclays "forecast import prices to have fallen 0.2% m/m in May, bringing
the annual rate of change in further deflation at -1.2% y/y. For imported prices
excluding petroleum, we also expect some weakness: -0.3% m/m and -1.3% y/y
consistent with the broadly based softness in imported inflation recently as
well as the strengthening of the dollar in trade weighted terms."
     - Friday: May retail sales; May industrial production/capacity utilization;
June Michigan sentiment index; April business inventories.
     Morgan Stanley said their "retail sales tracker points to a 0.6%M gain in
core retail sales (which we define as retail sales and food services excluding
auto dealers, gas stations and home improvement stores) in May, following a
broadly flat reading in April."
     RBC said they "look for robust vehicle sales (the run rate accelerated to
17.4m annualized from 16.4m prior) to boost topline retail activity in May by
about 0.9%." 
     Retail control (ex autos, gasolines, building materials) "should look
better at 0.7%" RBC added, after a "flat read in April, which was really a
function of significant monthly volatility of late." 
Calendar of next week's market events (prior, estimate):
10-Jun FED enters Blackout early June 8 and runs through June 20
10-Jun 1000 Apr JOLTS job openings level
10-Jun 1000 Apr JOLTS quits rate
10-Jun 1000 May ETI (110.79, --)
10-Jun 1100 Jun NY Fed expectations survey
10-Jun 1130 US TSY $36B 13W bill auction (912796RA9)
10-Jun 1130 US TSY $36B 26W bill auction (912796SW0)
11-Jun 0600 May NFIB Small Business Index (103.5, --)
11-Jun 0830 May Final Demand PPI (0.2%, 0.1%)
11-Jun 0830 May PPI ex. food and energy (0.1%, 0.2%)
11-Jun 0830 May PPI ex. food, energy, trade (0.4%, --)
11-Jun 0855 08-Jun Redbook retail sales m/m (1.4%, --)
11-Jun 1000 Jun IBD/TIPP Optimism Index (58.6, --)
11-Jun 1100 May Kansas City Fed LMCI (0.90, --)
11-Jun 1300 US TSY $38B 3Y note auction (9128286Y1)
12-Jun 0700 07-Jun MBA Mortgage Applications
12-Jun 0830 May CPI (0.3%, 0.1%)
12-Jun 0830 May CPI Ex Food and Energy (0.1%, 0.2%)
12-Jun 1000 Jun Atlanta Fed inflation (2.0%, --)
12-Jun 1030 07-Jun crude oil stocks ex. SPR w/w
12-Jun 1300 US TSY $24B 10Y note auction (9128286T2)
12-Jun 1400 May Treasury budget balance ($160.3B, -$198B)
13-Jun 0830 08-Jun jobless claims (218k, 215k)
13-Jun 0830 May imports price index (0.2%, -0.3%)
13-Jun 0830 May exports price index (0.2%, --)
13-Jun 1030 07-Jun natural gas stocks w/w
13-Jun 1300 US TSY $16B 30Y Bond auction (9128286H2)
13-Jun 1630 12-Jun Fed weekly securities holdings
14-Jun 0830 May retail sales (-0.2%, 0.8%)
14-Jun 0830 May retail sales ex. motor vehicle (0.1%, 0.4%)
14-Jun 0830 May retail sales ex. mtr veh, gas (-0.2%, --)
14-Jun 0915 May industrial production (-0.5%, 0.2%)
14-Jun 0915 May capacity utilization (77.9%, 78%)
14-Jun 1000 Jun Michigan sentiment index (p) (110.0, 100.0)
14-Jun 1000 Apr business inventories (0.0%, 0.4%)
14-Jun 1100 Q2 St. Louis Fed Real GDP Nowcast
14-Jun 1115 Q2 NY Fed GDP Nowcast
--MNI Chicago Bureau; tel: +1 312-431-0089; email:
--MNI Washington Bureau; tel: +1 202-371-2121; email:

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