US: ISM non-manufacturing index likely to rise to 58.0 in May - Nomura

According to analysts at Nomura, incoming business surveys for May suggest elevated sentiment although some cooling of forward-looking indicators implies US businesses are still grappling with trade policy uncertainty.

Key Quotes

“Consistent with the continued optimism, we expect the ISM non-manufacturing index to rise to 58.0 in May, from 56.8 in April. Measures of input prices will be of interest as the Empire State and Philly Fed surveys point to continued upward pressure. The Fed Beige Book for the June FOMC meeting also provided anecdotal evidence on broad-based increases in input prices.”

“JOLTS: Job openings jumped by 472k to 6.55mn in March, the highest reading on record. This raised the job openings rate 0.3pp to 4.2%. Hires and separations were essentially unchanged. The ratio of the unemployed to job openings fell to a historical low of 1.0% and highlights a tighter job market. As the labor market remains healthy, we continue to expect healthy job openings while layoffs remain low.”