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The economic calendar shows as key events for next week in the US the FOMC meeting and the NFP report. According to analysts from Danske Bank, payrolls data in the US should give a solid print next week, but it is still worth looking out for a deceleration in employment growth.

Key Quotes:  

“In the US, the most important event is the FOMC meeting on Wednesday. Fed has stated that they are on hold, so we expect them to keep the target range unchanged at 2.25-2.50%.”

The job reports is due out on Friday. Overall, the labour market remains strong, but we think it is important to keep an eye on whether employment growth starts to decelerate. We expect average hourly earnings to have risen +0.25% m/m in April, unchanged at  3.2% y/y. We expect nonfarm payrolls to have risen 190k.”

“Next week also brings ISM manufacturing, which is due out on Wednesday. We still expect manufacturing to have peaked and move slightly lower before it stabilises (still above 50). Based on a weighted average of the regional PMIs, we expect numbers to come in at 55.0 (currently 55.3).”

The focus will also be on a new round of high-level trade talks starting on Tuesday in Beijing. The following week the Chinese top negotiators will go to Washington and according to media reports the two sides will try to conclude the deal then and announce  a summit between US President Donald Trump and Chinese President Xi Jinping for the end of May.”