Forthcoming U.S. data - Nomura

Analysts at Nomura offered a preview of the forthcoming US data.

Key Quotes:

"Weekly chain store sales: Shopping activity picked up leading into the Memorial Day holiday weekend. Seasonal demand should continue to drive retail activity in June. Looking ahead, June is a five-week month for retailers (ending on 2 July) and includes Father’s Day. Productivity Q1, final: In the preliminary estimate, the Bureau of Labor Statistics (BLS) reported that nonfarm labor productivity declined at a 1.0% q-o-q annualized rate in Q1.

The combination of slow economic growth and solid job gains in Q1 led to the fall in labor productivity. However, revisions to GDP were positive for growth, which implies a smaller decline in labor productivity. As such, consensus expects the BLS to revise up labor productivity to -0.6% in Q1.

Unit labor costs Q1, final: Given the weak labor productivity growth, unit labor costs— labor compensation per output—rose by a strong 4.1% q-o-q in the preliminary estimate. Stronger growth should modestly push down this metric. Consensus expects a downward revision to 4.0%, from 4.1%.

Consumer credit: Consumer credit expanded strongly by $29.7bn in March, well above the previous near-term trend. Both revolving and non-revolving credit expanded at an above-trend pace. The pickup in revolving credit is a promising sign that consumers may be willing to spend more going forward. But the total level of revolving consumer credit outstanding remains well below prerecession levels and has been growing only modestly ahead of the latest reading. Consensus expects the pace of expansion to revert back to the previous trend, at $18.0bn in April.