LOOK AHEAD: US Macro Week Ahead: FOMC Minutes (Wednesday)

Solid headline/softer core April durable goods orders were roughly confirmed in the Full Report on Manufacturers’ Shipments, Inventories, & Orders, alongside a robust gain in factory orders. Overall the data merely reiterated what was known from the initial release, which  is that there is no sign of a meaningful reversal in the continued momentum of business investment going into Q2.

• April's factory orders report showed a 4.8% M/M gain in headline (4.6% expected, 1.8% prior rev from 1.5%) and 1.3% ex-transportation (0.8$ expected, 1.8% prior rev from 1.6%). That was the best month for manufacturing orders since May 2025 and it's now growing at a near-13% 3M/3M annualized pace.  That's largely due to soaring aircraft orders though ex-transport it was still very solid on the month, and up over 16% 3M/3M annualized.
• There were minimal revisions to the previously released durable goods orders (8.0% / 1.1% ex-transport) or capital goods nondefense ex-aircraft orders (-1.0%). 

Eurozone April PPI came in in line with expectations today at 4.93% Y/Y, the highest rate since March 2023, as it accelerated from 1.98% Y/Y in March. Most importantly, the print shows signs of producers handing higher energy prices downstream somewhat in April.

• Energy PPI inflation rose to 12.29% Y/Y in April from March's 4.01% but with the acceleration notably driven by base effects as the category slipped -0.41% M/M compared to -7.7% M/M in Apr 2025 (that -0.4% M/M of course follows a particularly strong 11.0% M/M increase in March). Refined petroleum products increased 55.40% Y/Y (32.44% prior, highest since July 2022, 11.14% M/M), while electricity / gas / utilities saw base effects drive up their yearly rate to 1.56% Y/Y (-2.97% prior) amid a 4.59% sequential fall.
• PPI excl. energy and also water supply also accelerated in April to its highest rate since June 2023 at 2.27% Y/Y (1.43% prior), in our view a sign of some indirect effects on broader input costs from the energy price surge. This was to be expected at some stage as producers hand these costs downstream, and represents a distinct dynamic to so-called second-round effects, which ECB officials have repeated today are not visible yet.
• Non-energy details see various rising at their highest Y/Y rates since 2023 rather than the overall acceleration being down to a single item jumping. For example, metals (basic + fabricated) increased 5.65% Y/Y in April (4.87% prior, 0.83% M/M), machinery 2.18% Y/Y (1.68% prior, 0.50% M/M), and rubber / plastics / minerals 2.37% Y/Y (0.82% prior, 1.62% M/M).
• Across countries, PPI picked up across all 'big 4' in April: Germany saw a 1.89% Y/Y rate (0.00% prior), France a 2.07% rate (also 0.00% prior), while Italy and Spain see more pronounced pressures currently, at 8.78% (5.39% prior) and 8.20% (3.10% prior), respectively.

• US Data/Speaker Calendar (prior, estimate). All times ET
• 06/04 0730 Challenger Job Cuts YoY (-20.9% prior)
• 06/04 0830 Nonfarm Productivity 1Q final (0.8%, 0.4%). Unit Labor Costs (2.3%, 2.4%)
• 06/04 0830 Initial Jobless Claims (215k, 215k), Continuing Claims (1.786M, 1.780M)
• 06/04 0830 Richmond Fed Barkin fireside chat
• 06/04 1000 Fed VC Bowman House Financial Services testimony
• 06/04 1130 US Tsy $75B each 4W & 8W bill auctions
• 06/04 1300 KC Fed Schmid fireside chat
• 06/04 1310 SF Fed Daly at Bloomberg Technology Summit
• Source: Bloomberg Finance L.P. / MNI