US: Key events for next week - Danske Bank

Analysts from Danske Bank, point out that next Friday, the labour market report for March will be released. They expect an increase of 160K in NFP. Also the ISM manufacturing is due and the FOMC minutes. 

Key Quotes: 

“In the US, the coming week brings the labour market report for March on Friday. The labour market has been in good shape over the past two months and we expect this trend to continue. The service sector is benefiting from the general economic upturn driven by domestic demand. Manufacturing employment has begun to recover and we expect this to continue, as both ISM manufacturing and Markit PMI continue to stay at solid levels. However, the March numbers will probably be affected significantly by the very harsh weather conditions in the middle of March. We forecast a total of 160,000 new jobs were created in March of which the service sector provided 160,000 and manufacturing 15,000. 

“As a warm-up for the labour market report, ADP employment for March is due on Wednesday. Although not a perfect predictor, ADP tends to give a relatively
good idea of what to expect from the official jobs report. 

“On Monday, ISM manufacturing for March is due. ISM manufacturing has soared over the past couple of months, emphasising that there is progress in manufacturing. In the same period, we have seen a divergence between ISM and PMI manufacturing emerge. (…)  We estimate that the ISM manufacturing fell back slightly to 56.0 in March. Even if it turns out that it increased further in March, we believe it is about to peak. Post crisis, ISM has only very rarely reached the current level and our models point towards a reversal.”

“The coming week also brings a number of speeches by FOMC members and we also get the minutes from the 14-15 March FOMC meeting. We will in particular look for discussions on the Fed’s desire to begin shrinking its balance sheet, as Fed Chair Janet Yellen said at the press conference that the FOMC members discussed it at the meeting.”