Top 5 Economic Calendar Events May 21-28

US political developments will continue to be watched extremely closely in the week ahead. The underlying tensions in Washington will have a big impact on risk appetite. In particular, developments surrounding allegations that President Trump interfered with the FBI investigation will have a big impact on market sentiment.

If former FBI Director Comey does testify in Congress, this will be a key set-piece event for the week.

Remarks from ECB members will also be increasingly important with markets focussing on extremely important Fed and ECB decisions due in June.

Geo-political risks will be watched closely with North Korea still an important area of concern while oil prices will be influenced strongly by the OPEC meeting.

1. US FOMC minutes

Minutes from the May Federal Reserve meeting will be released on Wednesday May 24th at 14.00 ET.

There were no major surprises from the May Federal Reserve Open Market Committee (FOMC) meeting with interest rates unchanged and a generally neutral statement.

Markets will be looking for further details on the potential for another increase in interest rates at the June FOMC meeting. In particular, the balance of forces within the committee will be important to assess whether key members surrounding Yellen are taking a relatively hawkish stance.

Commentary on progress towards agreeing a policy on ending the reinvestment of bond proceeds will also be an important element within the minutes.

Markets will also be assessing the degree of confidence that inflation will hit the 2% target on a sustained basis while hints surrounding the second-half policy outlook will also be important.

Commentary from Federal Reserve officials will also be an important focus throughout the week with markets looking to see whether key FOMC members cast doubts on the potential for a June rate hike.

2. OPEC Ministerial meeting

The latest OPEC Ministerial meeting will be held on Thursday May 25th in Vienna.

The OPEC meeting will be a very important focus during the week with a substantial impact on energy prices and there are also likely to be important wider implications across asset classes.

Russian and Saudi Arabia oil ministers have agreed on extending the current round of production cuts until March 2018.

A rapid move towards reaching agreement at the meeting would be important in boosting confidence that compliance with maintaining production cuts would remain high. Overall sentiment would also be boosted if OPEC can persuade other counties to also limit production levels or if production cuts are deepened.

Iran’s stance will also be an important focus during the meeting with Iraq commentary also significant.
Any breakdown in talks and failure to extend production cuts would have a substantial negative impact on oil prices, especially as markets have moved towards pricing in an extension.

3. Bank of Canada Monetary policy decision

The latest Bank of Canada monetary policy statement will be released on Wednesday May 24th at 10.00 ET.

The Bank of Canada will release its interest rate decision and policy statement with rates expected to remain on hold at 0.5%.

At this meeting, there will be no update Monetary Policy Report (MPR) and no press conference from Governor Poloz.

Commentary on the housing market will be a key focus in the statement, especially given fears over rampant inflation surrounding the Toronto-area market and serious difficulties at the Home Capital Group.

An important area for the bank will be whether monetary policy has a role to play to control housing or whether there will be further reliance on macro-prudential measures.

Wider commentary on the economy and whether optimism seen in the April report has been sustained will also be an important focus. The bank is not likely to take a more hawkish stance on inflation.

Trade issues will also be important given the central bank’s underlying concerns surrounding export trends. There will also inevitably be a high degree of uncertainty surrounding US trade policies and their impact on Canada.

4. Eurozone flash PMI data

The flash Eurozone PMI data will be released on Friday May 26th at 04.00 ET.

The French and German data will be released over the previous hour.

The April Eurozone PMI data continued to show a robust economic performance with the composite index at a 6-year high and further upward pressure on prices.

The May release will be important in assessing whether the momentum has been sustained and will also have important implications for the pivotal June ECB meeting.

The ECB will continue to be extremely cautious surrounding prospects, but another strong set of data would boost confidence in the both growth and inflation outlooks. There would also be increased speculation over a more optimistic stance at the June meeting and a potential change in forward guidance.

The ECB will be even more cautious if there is evidence that momentum is fading.

The French and Eurozone data will be watched to assess whether the French Presidential election result has had any immediate positive impact on business confidence both in France and across the Eurozone.

5. US GDP (Q1 revision)

The revised Q1 GDP data will be released on Friday May 26th at 08.30ET

The first estimate for Q1 GDP growth was weaker than expected at 0.7% and the weakest reading for 3 years as consumer spending growth slowed sharply.

The revised data will have an important impact on sentiment and interest rate expectations.

In its May statement, the FOMC statement expected the first-quarter GDP slowdown to be transitory. An upward revision to the GDP data including a stronger reading for consumer spending would help strengthen the Fed’s case that the economic slowdown will be temporary.

Any downward revision would, however, increase market doubts surrounding the overall outlook and make it more difficult for the Fed to tighten policy further, especially if there was a slide into negative territory.

The latest durable goods orders data will be released at the same time.

Tim is a contributing author to He is an economist and has been involved in financial markets for over 20 years as an analyst. He specialises in global economic trends, macro policy and central banks. Extensive knowledge, experience and data mining is used to anticipate trends in equities, bonds and forex with a contrarian slant. He is a graduate of the University of York with a degree in Economics/Econometrics.