US and euro area purchasing managers’ indices
On May 24 S&P Global rolled out its flash PMIs for the United States and various European countries. Analysts had expected such factors as rising energy and other commodity costs − as well as new challenges to global value chains due to the Ukraine war and China’s COVID-19 lockdowns − to weigh down sentiment, especially in manufacturing. But the actual declines were small. The euro area manufacturing PMI fell from 55.5 in April to 54.4 in May and services from 57.7 to 56.3. Corresponding US changes were from 59.2 to 57.5 and from 55.6 to 53.5. The most notable decline reported yesterday was in the United Kingdom, where the services PMI slid from 58.9 to 51.8 amid record-high inflation. PMI figures above 50 indicate that respondents expect an economic expansion.
The United States
Minutes of the latest US Federal Reserve monetary policy meeting
Later today (May 25) the Fed will publish the minutes of its May 3-4 meeting. It remains to be seen whether the members of the Federal Open Market Committee (FOMC) are prepared to keep tightening monetary policy in large increments until inflation releases its grip, even if this occurs at the expense of weaker economic growth.
The Nordic countries
Early Swedish stock market closing and new NIER economic tendency survey
Today (May 25) the Swedish stock market will close at 1 p.m. ahead of the Ascension Day holiday on May 26. The Swedish National Institute of Economic Research (NIER) releases its latest monthly Economic Tendency Survey today at 9 a.m. Inflation is adversely affecting Swedish households but is also having an impact on business activity. The Economic Tendency Indicator edged down from 110.3 in March to 109.5 in April led by manufacturing and retail indicators. In the near future we expect further downturns in business sentiment.
More muted forecasts
New Investment Outlook!
High inflation, central banks that must quickly raise key interest rates, COVID-19 lockdowns in China, the war in Ukraine and much lower economic growth expectations have plagued financial markets during 2022. Risk appetite has fallen as problems have mounted. We expect stabilisation soon, but the risk situation remains troublesome.
Yesterday (May 24) we published the latest issue of our quarterly Investment Outlook report, where you can read about our forecasts for equities, fixed income investments and other asset classes and read in-depth articles about interesting themes and trends. You will find links to the report, summaries and a video below.
Download the full report only (pdf)