After yesterday's eventful day in the Scandi markets, focus today turns to the US in the form of retail sales figures for April and the preliminary University of Michigan consumer survey in May. Retail sales data for April will be important as our expectations (and the Fed's) of a rebound in GDP growth in Q2, following the weak GDP growth in Q1, are based on a rebound in private consumption growth. The retail sales control group is expected to increase 0.4% m/m in April from 0.1% m/m in March.
US consumer confidence has fallen for four consecutive months according to the University of Michigan consumer survey but is still at a relatively high level. Although it is natural that consumer confidence has fallen from the previous high level, consumers need to stay optimistic as private consumption is the main US growth driver. Consumer confidence is expected to increase to 89.5 in May from 89.0 in April. Consumers' long-term inflation expectations, which fell back to a record-low 2.5% y/y in April, might also attract some attention.
In the euro zone, the first estimates for Q1 GDP growth in Germany, Spain and Italy are due along with a revision for Q1 GDP growth in the euro area. We expect today's revision of GDP in the euro area to remain unchanged at 0.6% q/q in Q1 compared to the initial estimate released two weeks ago.
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