The start of a new month can mean only one thing for investors: time for the all-important monthly U.S. employment report, but also for a likely European Central Bank rate cut, as well as the outcome of India’s marathon general election.Is the U.S. economy finally cooling? It will take several months of data to answer that question, but one key piece of the puzzle comes with the closely watched employment report out on June 7.
Markets see a Modi win as providing political stability and continuity in India to support sustained economic growth. Meanwhile, gasoline futures have fallen by 7%, offering a potential boon to customers at the pump. But, U.S. gasoline inventories aren’t declining as quickly as they ordinarily would at this time of year, which suggests consumption isn’t quite hot enough to put a dent into supply. A measure of demand for immediate delivery of crude is also around its lowest since December.
Bankers pinpoint that it’s companies driving the charge, and they expect more UK deals, as the interest rate outlook and economic backdrop stabilize and competition from private equity funds for assets is still muted. Inflation in the bloc’s dominant services sector remains sticky and its economy is recovering faster than expected, while a closely-watched wage growth figure accelerated last quarter, leaving the outlook beyond June less certain.