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Analysts at Nomura expect a steady increase of 2pp to 59.4 for the Chicago PMI in May as early indicators for business activity during the month are consistent with a pickup in activity.

Key Quotes

“The Philly Fed, Empire State and Richmond Fed manufacturing surveys showed an improvement in their topline indices after some softening during April. As businesses focus more on the robust economic outlook for 2018 amid easing tension between the US and China, we expect them to remain optimistic. However, an escalation in trade tension may significantly affect business confidence.”

Pending home sales: Pending home sales, a leading indicator of existing sales, increased 0.4% m-o-m in March, but remained 4.4% below their level 12 months ago. A burst of colder-than-usual weather in April may have affected contract signing activity during the month. Over the longer term, we expect growth in pending home sales to continue to face supply constraints despite steady consumer demand.”