Market movers today
The US job report will be the main focus today. We expect an increase in non-farm payrolls of 250,000 but see risk of a pay-back from the extra strong April figure. The ADP employment disappointed in April and suggests some downside risk to payrolls although the intra-month relationship is not great. The movement in the participation rate makes it difficult to make accurate estimates about the unemployment rate but we expect it to rise back up to 6.5% following the 0.4pp decline in April.
In Germany industrial production is expected to increase in line with the stronger-than-expected factory orders released yesterday.
German labour costs for Q1 are also due for release today and, in light of the low inflation in Germany despite very low unemployment, could attract some attention. Since Q2 13 labour costs have stayed around 2% y/y after the growth rate was close to 3% in 2011-12.
We expect S&P to upgrade Ireland to the single-A level and remove the negative outlook on Italy. Moreover, Moody's could publish an updated rating on Finland.
We expect Danmarks Nationalbank to track the cuts from ECB.
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