The May 2 week has a steady flow of economic data releases, but it is the April employment report that will be the focus. Three major central banks will make their respective monetary policy announcements. Next week routine monetary policy statements are expected from the Reserve Bank of Australia, the Bank of England and the ECB. The Reserve Bank of Australia's announcement will be published in the US during the early morning hours of Tuesday. While the Bank's most recent statements have placed policy on hold, the news of a surprising uptick in inflation during the first quarter may return the Bank to a tightening bias. The Bank of England's Monetary Policy Committee holds a two-day session on Wednesday and Thursday. Its decision is expected around 0700 ET on Thursday. The Bank probably will not hike rates yet, or reduce the size of its Asset Purchase Program, but it is leaning more in that direction. The ECB increased rates by 25 basis points at its last meeting on April 7, but no further hikes are expected at the Thursday meeting. The announcement should be released around 0745 ET.
After the end of the traditional press blackout period that surrounds an FOMC meeting, Fed policymakers will be making public comments again. There probably will be no real surprises in any of the speeches to be given. Although the data release calendar is fairly busy over the course of the week, not much will distract from employment report for April on Friday at 0830 ET. Currently market expectations are for a rise in nonfarm payrolls of about 200,000, in line with the last two months. The unemployment rate is anticipated to be about the same at 8.8%. This would be consistent with an improvement in labour market conditions, although with a long way to go. Still, it would be more evidence of a sustained recovery for jobs. The only data likely to result in any last minute adjustment to analysts' outlooks for employment is the ADP National Employment Report at 0815 ET on Wednesday. The report has matched up fairly closely to the change in payrolls for the last two months, and there does not appear to be any special factors that might throw that off for the April data. Other labour market specific reports are the Challenger numbers on layoff intentions in April at 0730 ET on Wednesday and theMonster.com Employment Index for April which will be released in the early hours of Thursday. Initial claims levels for the week ended April 30 will be reported at 0830 ET on Thursday. Recent weeks have shown an ... Read more