The FOMC meeting tonight should provide few surprises as the Fed tapers another USD10bn of asset purchases. There will be no press conference or new projections and the statement is expected to have been changed very little. We look for the Fed to acknowledge the recent improvement in data but at the same time keep the current very soft tone on inflation - see FOMC preview , 29 April.
On the data front we have a packed day with many releases out of both the euro-area and the US. Spanish inflation is released at 09:00 CET followed by Euro flash inflation at 11:00 CET. After German inflation surprised to the downside yesterday we have revised down our estimate for euro inflation from 0.8% to 0.7% for April.
Spanish GDP may also receive some attention this morning. We look for a rise of 0.4% q/q, which would mark the biggest increase since 2008.
In the US April ADP employment will give some input to the rebound in employment following the bad weather. Consensus looks for 210k but we see some upside risk following strong data recently.
We look for US GDP for Q1 to have risen 1.0% q/q AR (consensus 1.2% q/q AR). Growth in Q1 was held back by weak consumption and soft housing partly related to the bad weather, as well as a reduction in the contribution from inventories. Chicago PMI for April is expected to increase slightly to 57.0 from 55.9 after five months of decline.
Norway releases unemployment, retail sales and industrial confidence today.
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