Macroeconomics: The Week Ahead: 1-5 June 2026

The US/Iran negotiations, the broader conflicts in the Middle East, AI euphoria and prospective mega tech sector IPOs continue to dominate markets, with the first week of the month filled with the usual run of statistical highlights: US labour market indicators and PMIs, with Eurozone CPI, Australia and India Q1 GDP, Japan Q1 Capital Spending and Canadian Unemployment also among the highlights. There are dozens of major central bank speakers (with many likely striking a hawkish tone) and the Fed’s Beige Book just before the Fed and ECB enter their pre-meeting ‘purdah’ periods, while both India’s RBI (5.25%) and Poland’s NBP (3.75%) are expected to keep rates on hold. In the commodity sector, a slew of major conferences includes the Posidonia shipping conference / exhibition in Athens, S&P MPGC energy conference in London, China’s premier Solar and Hydrogen events and US Harbor Aluminium conference, as the Atlantic Hurricane season gets underway. There are also the Australian Abares crop, FAO Food Price Index and FAO Cereals S&D monthly reports. Politically outside of the Middle East, tensions between the EU/UK and Russia remain high, the protracted UK political crisis continues, and there are the various security and defence policy comments from the weekend Shangri-La conference to consider, along with the results of first round of the Colombian Presidential elections.

PMIs/ISM: The primary points of interest will be readings from Asia, after China’s NBS readings saw a marginal easing in the Manufacturing PMI (in line with seasonal patterns), most notable for the drop in Export Orders (48.6 vs. 50.3), some easing in price sub-indices, a further slide in the Steel PMI to 47.9 from 49.2, and a small rebound in Services PMI, mostly likely due to May Day holiday spending. In the US, ISM surveys are expected to show Manufacturing edging up 0.3 pts to 53.0, and Non-manufacturing also up 0.3 pts to 53.9, within the detail Employment measures are seen higher, Prices Paid continuing to rise, while Orders are forecast to pick up in Manufacturing, but ease slightly for Services. Both would underline that economic activity continues to expand at a solidly moderate pace.

USA: JOLTS Job Openings have been very volatile over the past year, and subject to often major revisions, the April reading is seen barely changed at 6.857 Mln, still well above December’s 6.550 Mln low, and well below January’s 7.240 Mln high – which to be honest suggests that this measure is not really very helpful in forming a picture of labour demand. Wednesday’s ADP Employment is forecast to be little changed at 118K, while Friday’s headline and Private Payrolls are expected to post a solid if unspectacular 89K rise, with the Unemployment Rate unchanged at 4.3%, and Average Hourly Earnings edging up to 0.3% m/m but easing to 3.4% from 3.6% in y/y terms. Wednesday’s Beige Book will likely continue to paint a mixed, though generally positive picture of economic activity, with labour demand still ‘steady to up’. The focal point will be prices which in April were described pressures as “moderate overall, with the vast majority of Districts reporting moderate increases and others pointing to modest growth. Generally, input cost increases outpaced selling price growth, compressing margins. Energy and fuel costs rose sharply in all Districts, attributed to the Middle East conflict, leading to higher freight and shipping costs and higher prices for plastics, fertilizers, and other petroleum-based products. Input cost pressures beyond energy-related increases were also widespread.” Margin compression will remain, the question is whether price pressures continued to be described as “moderate overall” or accelerating. Auto Sales are seen little changed and erring on the side of sluggish at 16.0 Mln.

Eurozone: ECB speakers are largely signalling that rates will need to rise in June, per se rendering Monday’s ECB Consumer Inflation Expectations (median for 1-yr 4.1% from 4.0%, 3-yr unchanged at 3.0%), and Tuesday’s CPI (median headline 0.1% m/m, 3.2% y/y from 3.0%, and core 2.4% y/y from 2.3%) somewhat academic, though certainly justifying a hike. The real question is how the ECB will guide markets in terms of further hikes, which they will not pre-commit to, given the high level of uncertainty about the Middle East. But they will likely temper a commitment to keep inflation under control, by emphasizing the downside risks to growth, and perhaps suggest that knock on effects to wages may be more muted than was the case in the post pandemic ‘boom’.

Elsewhere, Japan’s Capital Spending is expected to slow to 4.0% y/y with the ex-Software measure seen up 5.4% y/y, though this median forecast is largely an extrapolation from provisional Q1 GDP, and Q1 earnings imply upside risks, which would also see Q1 GDP revised up. Labour Cash Earnings for April are expected to remain robust at 3.2% y/y and in real terms at 1.7% y/y, further bolstering the case for a June rate hike, though Household Spending is seen remaining in negative territory at -1.5% y/y, though better than March’s -2.9% y/y. India’s Q1 GDP is forecast to slow to 7.0% y/y from Q4’s 7.8%, Trade is likely to have been a net drag on the economy, given that high US tariffs were in place until the end of February, and then the energy price shock and disruption to shipping and industrial output in March. Domestic demand above all from a strong harvest and sales tax cuts should have provided a considerable offset, but stronger headwinds are likely in Q2. A close eye needs to be kept on CPI readings from Indonesia, Philippines and Thailand, which will to a large extent dictate the path higher for rates, as well for beleaguered local currencies.

There are 12 S&P 500 companies reporting this week, with worldwide corporate earnings highlights as compiled by Bloomberg News likely to include: Broadcom, Ciena, Credo Technology Group, Crowdstrike, HP Enterprise, Industria de Diseno Textil aka Inditex, Medtronic, Meituan, Palo Alto Networks, Veeva Systems.