Italian factory orders, UK inflation, US retail sales

Otmane El Rhazi : New Industrial Orders (09.00 GMT): The year-over-year trend in new factory orders has been a bright spot for the Italian economy lately. Although the monthly numbers have been unusually volatile, a modest growth trend is evident in the annual data.

Italy’s economy is still struggling but the potential for improvement in the months ahead for the industrial sector can’t be ruled out. Business survey data for manufacturing certainly look encouraging these days. Markit’s purchasing managers index (PMI) for manufacturing in Europe’s third-largest economy has turned higher lately, rising to 54.0 last month — the highest since 2011 and comfortably above the neutral 50 mark. Markit’s survey numbers also show that job creation in the sector is improving.

“The manufacturing sector enjoyed another strong month of growth in April, buoyed by continued success in export markets,” advised the Markit economist who oversees the Italian PMI data set. “What is more, the upturn moved up a gear as growth rates of output, new orders, and purchasing activity all reached three-year highs.”

Today’s hard data on new orders will serve as a reality check on the upbeat mood that’s reflected in recent PMI reports. Considering that the year-over-year comparisons for new orders have been consistently positive since last September, it’s reasonable to assume that growth with the annual comparison will persist in today’s release.

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