Economic Data Overview

In the week of May 9, the first wave of U.S. economic data for the start of Q2 is due, with retail sales numbers and some of the inflation indicators. There will also be an early take on consumer confidence for the month of May. The pace also remains brisk for the release of first quarter earnings reports. Just as the April employment reports have set the tone for the labour market in the second quarter, the April numbers on retail sales on Thursday will influence the outlook for consumer spending. Better weather with the arrival of spring and the late timing of the Easter holiday may have helped move seasonal merchandise. Rising prices for gasoline will add to the upward momentum to the service station component. Decent sales volume of motor vehicles combined with firmer prices should also contribute to higher sales at auto dealers. The inflation data will continue to feel the impact of higher oil prices, although increases in food costs appear to be moderating somewhat. The Import Price Index on Tuesday will get another push higher from petroleum costs, although less than in the March report. The PPI on Thursday is being released at the same time as the retail sales report. It will probably be overshadowed, but it is expected to show that some pipeline pressures from the intermediate and crude processing stages are passing through into finished goods. The CPI is due on Friday and will get the most attention of the three reports on inflation. Seasonal adjustment factors expect increases in gasoline prices to start as summer approaches, but it probably will not be on par with the actual rise experienced in April. Food price increases should be more moderate. At the core, there are signs of faster gains in medical care and motor vehicles, as well as in jewellery. The two earliest of the May measures of consumer ...Read more