This week the markets will be watching several important economic reports, which will help adjust the outlook regarding the Fed’s June interest-rate actions.
Here are three economic events that could affect your portfolio this week. For a full listing of all upcoming economic events, check out the TipRanks Economic Calendar.
» May’s ISM Services PMI – Monday, 06/5 – the ISM Services Index released by the Institute for Supply Management (ISM) shows business conditions in the U.S. services sector, which is responsible for almost 80% of the country’s GDP and thus serves as an indicator of the overall economic conditions. A higher-than-expected reading would be inflationary, strengthening the Fed’s case for continued monetary tightening.
» April’s Factory Orders – Monday, 06/5 – the report, released by the US Census Bureau, is a measure of the total orders of durable and non-durable goods such as sales, inventories, and orders at the manufacturing level. The Factory Order report can offer insight into inflation and growth in the manufacturing sector. Although the data is backward-looking, it conveys the sentiment and outlook of all manufacturing-sector participants toward the economy for the next few months. Stronger-than-expected data may underline the U.S. economy’s resilience, permitting more hawkish monetary policy.
» April’s Consumer Credit – Wednesday, 06/7 – the report, released by the Federal Reserve, indicates whether consumers can afford large expenses, which can fuel economic growth. However, a high figure may also indicate that the economy is overheating, as consumers borrow in order to live beyond their means; thus, a higher-than-expected reading adds to the inflationary signals and warrants continued monetary tightening.