Fed to decide on rates

In the US, the main focus will be on the Federal Reserve's Open Market Committee (FOMC) meeting. Here the markets are pricing in a rate cut of 25 basis points. Of particular interest is the employment report for April.

This should provide a view on the unemployment rate, non-farm payrolls, manufacturing payrolls and the initial jobless claims in the US.

We will also have some figures related to consumer spending abilities highlighting personal income and personal spending figures for March along with personal consumption figures for the first quarter of 2008. Data on construction spending, vehicle sales, factory orders and consumer confidence are also due to be published this week. Finally we will also see the Gross Domestic Product (GDP) figure for the first quarter of 2008 along with the ISM non manufacturing composite for April.

The economic schedule in the Eurozone will be quite a thin week. The main interest will probably lie in the business surveys indicators which are envisaged to shed some light on the activity levels within the Eurozone.

These encompass the manufacturing and retail Purchasing Manager Index (PMI) for April, along with the economic, service, consumer and industrial confidence level.

Elsewhere the strength of the labour market in the Euroarea will be revealed through the unemployment figures for March. Preliminary Harmonised index of consumer prices (HICP) for April are also due to be released.

In the UK market participants will take a view on the activity level through the manufacturing and services Purchasing Manager Index (PMI). Mortgage approvals and net consumer credit will provide a snapshot on the housing market in the UK. Finally, the money supply figures for the UK will complete the picture for the Eurozone.

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