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The last trading session for this week and the first for the month of June for the forex market economic calendar has important US economic data, with the release of the US Nonfarm payrolls, the ISM Manufacturing data and the US Unemployment Rate which probably will move the US Dollar. There is also a G7 Meeting and several Markit Manufacturing PMI figures expected in the European Session and the American Session, about the economies of the Eurozone, US and Canada. Moderate to high volatility should be expected today in the forex market, mainly for the US Dollar.

Key economic events in the forex market today:

European Session

  1. Russia: Markit Manufacturing PMI, Spain: Markit Manufacturing PMI, Switzerland: SVME Manufacturing PMI, Italy: Markit ADACI Manufacturing PMI, Germany: Markit Manufacturing PMI Final, Eurozone: Markit Manufacturing PMI Final, Italy: GDP Growth Rate (QoQ Final, YoY Final), UK: Markit/CIPS Manufacturing PMI

Time: 06:00 GMT, 07:15 GMT, 07:30 GMT, 07:45 GMT, 07:55 GMT, 08:00 GMT, 08:30 GMT

Several Manufacturing PMI figures which provide information about the state of manufacturing sector are expected in the European Session. The Manufacturing PMI is a significant indicator of business conditions and figures result above the 50.0 level signal expansion and increased business conditions, being supportive and positive for the local economies and currencies. The Euro may find additional support if the Manufacturing PMI figures in Spain, Italy, Germany and in the Eurozone will be higher than expected and the GDP Growth Rate in Italy beat estimates.

As seen from the following chart the Euro Area Manufacturing PMI has been in a downward trend in 2018, after peaking in December 2017.

“The IHS Markit Eurozone Manufacturing PMI fell to 55.5 in May of 2018 from 56.2 in April, slightly below market expectations of 56, preliminary estimates showed. The reading pointed to the slowest expansion in factory activity since March of 2017 amid softer rises in new business, employment, backlogs of work and longer supplier delivery times. Also, business confidence and the outlook worsened.”, Source: Trading Economics.

The forecast is for a decline for the Euro Area Manufacturing PMI at 55.5, lower than the previous figure of 56.2, and lower readings for the Manufacturing PMI for Spain, Italy and Germany. An unchanged GDP Growth Rate QoQ at 0.3% for Italy and a lower yearly GDP Growth Rate at 1.4%, lower than the previous reading of 1.6%, may influence negatively the Euro.

Germany Markit Manufacturing PMI

Lower figures for the Markit Manufacturing PMI are expected also for Switzerland and the UK, which may influence negatively the Swiss Franc and British Pound accordingly.

American Session

  1. US: Nonfarm Payrolls, Average Hourly Earnings MoM, Unemployment Rate, Fed Kashkari Speech, Markit Manufacturing PMI Final, ISM Manufacturing Employment, ISM Manufacturing PMI, Construction Spending MoM, Total Vehicle Sales, Canada: Markit Manufacturing PMI

Time: 12:30 GMT, 12:55 GMT, 13:30 GMT, 14:00 GMT, 19:30 GMT

The US Nonfarm Payrolls data is probably the main economic event for the day, which can move the US Dollar if there is any economic surprise, positive or negative. A higher than expected figure for the US Nonfarm Payrolls and a lower than expected for the Unemployment Rate should be positive and supportive for the US Dollar, reflecting a robust labor market. The chat shows that the US Nonfarm Payrolls are very volatile and are influenced many times by seasonality.

Nonfarm Payrolls

The forecast for the US Nonfarm Payrolls is for an increase and a figure of 188K, higher than the previous figure of 164K, while the Unemployment Rate is expected to remain unchanged at 3.9%. The US monthly and yearly Average Hourly Earnings are expected to increase, The Markit Manufacturing PMI to remain unchanged at 56.6, The ISM Manufacturing PMI to increase at 58.1, higher than the previous reading of 57.3 reflecting increased business conditions in the US manufacturing sector, and the monthly Construction Spending to increase. Overall positive economic data is expected for the US Economy.

For Canada the Markit Manufacturing PMI is expected to decline at 55.4, marginally lower than the previous figure of 55.5.

Pacific Session

  1. Australia: IHA New Home Sales MoM

Time: 01:00 GMT

New Home Sales indicate the housing market condition, higher than expected figures are considered positive for the economy as house buyers spend money on goods and services stimulating the broader economy.

Pacific Session

  1. Japan: Nikkei Manufacturing PMI

Time: 00:30 GMT

The Nikkei Manufacturing PMI provides important economic information about the state of manufacturing sector in Japan, being a significant indicator of business conditions and the overall economic conditions in Japan. Higher than expected figures are considered positive. The forecast is for an unchanged figure of 52.5, which should have a neutral effect on the Japanese Yen.

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