By Kasra Kangarloo

WASHINGTON (MNI) – Nonfarm payrolls and ISM manufacturing will be
the most prominent releases next week, as well as a string of other
employment data and auto sales.

Payrolls are expected to rise more than last month’s disappointing
figure, though still below the above-200,000 pace that exploded market
expectations earlier in the year. Initial jobless claims have also
receded from their downward trend, pushing back above 380,000 claims for
each of the last three weeks. This is still a healthy level for initial
claims — any level below 400,000 is regarded by economists as an
indicator of jobs growth — but the upward trend indicates that the job
market may be losing momentum.

Nonfarm payrolls will be released Friday at 8:30 a.m. ET and
initial jobless claims will be released Thursday at 8:30 a.m. ET.

There are two other employment indicators for the week — the
Automatic Data Processing employment report, to be released Wednesday
at 8:15 a.m. ET and the Challenger job cuts report, to be released
Thursday at 7:30 a.m. ET.

The ADP report is expected to be on par with the payrolls report in
terms of job gains, though the month-to-month correlation between the
two can be shaky. Markets, however, will likely still react strongly to
any surprises in the report.

The ISM reports for the manufacturing and non-manufacturing
sectors, to be released Monday at 10:00 a.m. ET and Wednesday at 10:00
a.m. ET, respectively, are each expected to maintain their modest
strength.

ISM manufacturing has hovered between 50 and 55 for most of the
past year, a level that indicates only mild expansion in the sector.
Even a modest fall in the index could spook markets, as the
manufacturing sector has been the bedrock of the recent strengthening in
the recovery, due to renewed auto sales and the resilience of consumer
appetite for big-ticket items.

The Chicago Report, also nicknamed Chicago PMI, will be issued at
9:45 ET Monday.

Auto sales will also be released during the week and are expected
to continue the strong pace set during the first quarter. Auto sales
have been a significant driver of growth in the early months of the
year, due largely to replacement purchases resulting from a record-high
average age for the U.S. vehicle fleet. Auto sales will be released
throughout the day on Tuesday.

Personal income, to be released Monday at 8:30 a.m. ET, is expected
to increase a modest 0.3% over the month, after two straight months of
0.2% growth. The recent improvements in consumption could be limited
until larger improvements are seen in average income, so any upside
surprises in the number could move markets.

Other reports over the week include construction spending on
Tuesday at 10:00 a.m. ET, first quarter productivity on Thursday at 8:30
a.m. ET, factory orders on Wednesday at 10:00 a.m. ET, and the Mortgage
Bankers’ Association mortgage application index on Wednesday at 7:00
a.m. ET.

Here is a list of Federal Reserve speakers for the week:

Dallas Federal Reserve President Fisher will speak on the jobs
market at the Milken Institute Global Conference in Los Angeles on
Monday at 5:30 p.m. ET.

Minneapolis Federal Reserve President Kocherlakota will speak on
the Indian economy in Washington, D.C. on Tuesday at 9:30 a.m. ET.

San Francisco Federal Reserve President Williams will speak on the
economy at the Milken Institute Global Conference in Los Angeles, CA on
Tuesday at 11:00 a.m. ET.

Atlanta Federal Reserve President Lockhart will speak on monetary
policy at the Milken Institute Global Conference in Los Angeles, CA on
Tuesday at 12:30 p.m. ET. Chicago Fed President Evans is also a speaker
and both will be interviewed today on CNBC as well.

Philadelphia Federal Reserve President Plosser will speak on the
economic outlook in San Diego, CA on Tuesday at 3:00 p.m. ET.

Federal Reserve Governor Tarullo will speak on regulatory reform in
New York, NY on Wednesday at 8:00 a.m. ET.

Richmond Federal Reserve President Lacker will speak on the economy
in Norfolk, VA on Wednesday at 12:30 p.m. ET.

San Francisco Federal Reserve President Williams will speak on the
economy in Santa Barbara, CA on Thursday at 11:00 a.m. ET.

Atlanta Federal Reserve President Lockhart will speak on the
economy in Santa Barbara, CA on Thursday at 1:00 p.m. ET.

Philadelphia Federal Reserve President Plosser will speak on the
economy in Santa Barbara, CA on Thursday at 1:30 p.m. ET.

— Kasra Kangarloo is a reporter for Need to Know News

** MNI Washington Bureau: 202-371-2121 **

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