Week Ahead Economic Outlook: Key Indicators and Insights for the Week of May 26, 2025

Comprehensive Preview of Global Economic Developments by S&P Global Market Intelligence

By Chris Williamson
Chief Business Economist, S&P Global Market Intelligence

Jingyi Pan
Economics Associate Director, Operations – IMPG, S&P Global Market Intelligence

This article presents an abridged version of S&P Global Market Intelligence’s detailed Week Ahead Economic Preview for the week starting May 26, 2025.

To access the full report with expanded analysis and data charts, please use the “Download Full Report” link.

Global Economic Data to Watch: US GDP, Inflation, and FOMC Insights Amid Global Trade Pressures

The upcoming week promises to be pivotal for economic analysts and market participants as revised data on US economic growth, inflation trends, and Federal Open Market Committee (FOMC) deliberations become available.

These updates will provide essential guidance regarding the trajectory of interest rates, particularly in the context of persistent tariff uncertainties impacting both US and global economies.

Alongside the US-focused releases, critical indicators from mainland China—including the National Bureau of Statistics’ Purchasing Managers’ Index (PMI)—will offer insight into the manufacturing sector’s resilience amid trade tensions.

Complementary data from Japan and India will further illuminate the state of industrial production and economic growth in the Asia-Pacific region.

United States Economic Indicators: Revised Q1 GDP, Inflation Measures, and Trade Data

Revised First Quarter GDP Numbers

Initial US GDP estimates for Q1 2025 indicated a 0.3% annualized contraction, a figure broadly regarded as underestimating the economy’s true performance.

Nonetheless, the revised data expected this week will clarify the extent to which growth slowed, confirming a noticeable weakening accompanied by heightened price pressures.

Inflation: Core Personal Consumption Expenditures (PCE)

The Federal Reserve’s preferred inflation measure—the core PCE price index—will be updated, offering a refined view of underlying inflation dynamics.

Given recent spikes in prices, particularly due to supply constraints and tariffs, this metric will be closely scrutinized for signals about inflation persistence and trajectory.

Durable Goods Orders and Trade Balances

Goods trade figures for April will be reported, providing insight into export and import dynamics amid tariff-driven disruptions.

Early data suggest export volumes of both goods and services have fallen for two consecutive months, with services exports declining at the sharpest pace since the pandemic lockdowns, indicating weakened foreign demand.

Consumer Confidence and Housing Market Indicators

Consumer sentiment indices and home price data will further contribute to assessing domestic demand strength and household financial conditions.

These metrics are particularly relevant given the elevated uncertainty surrounding tariffs and their inflationary impacts.

Manufacturing and Supply Chain Pressures

The S&P Global Flash US PMI for May highlighted an unprecedented build-up in manufacturing input inventories, driven largely by tariff-related concerns.

This stockpiling coincides with acute supply shortages and the sharpest increase in input prices since November 2022.

Notably, while many advanced economies (the G4) have experienced easing inflation pressures, the US continues to see rising input costs, portending potentially stronger consumer price inflation ahead.

Federal Reserve Outlook: Steady Rates Through Year-End with Potential Cuts

The synthesis of incoming data supports the forecast that the Federal Reserve will maintain the current interest rate stance through December 2025, deferring any reductions until the year’s end.

The minutes from the May 6-7 FOMC meeting, released this week, will provide nuanced details on policymakers’ views, especially regarding growth prospects and inflation risks influenced by tariffs.

Additionally, speeches from Fed officials scheduled throughout the week are expected to further clarify the Committee’s policy outlook and response to evolving economic conditions.

Global Central Bank Activity: Interest Rate Decisions in New Zealand and South Korea

Monetary policy decisions in the Asia-Pacific region will be pivotal, with rate cuts anticipated in both New Zealand and South Korea amid ongoing global trade uncertainties.

These moves reflect broader central bank efforts to balance inflation containment with economic support.

Mainland China and Asia-Pacific Economic Indicators

The Chinese National Bureau of Statistics will release May’s PMI data, shedding light on manufacturing sector momentum amid global trade tensions.

Concurrently, Japan and India will publish key industrial production and GDP statistics, respectively, which will be instrumental in assessing regional economic health.

Japan’s consumer confidence, unemployment rates, retail sales, and industrial output figures will also be closely observed.

The recent au Jibun Bank Flash Japan PMI indicated a return to contraction in business activity midway through Q2, highlighting ongoing challenges.

Regional Focus and What to Expect

Americas: Interest Rate Policy and Inflation Focus

In the United States, the Fed’s recent decision to keep rates steady will be analyzed in detail through the FOMC minutes, with additional commentary expected from various policymakers.

Given the tariff uncertainty’s inflationary implications, inflation measures such as the core PCE price index will receive heightened attention.

Durable goods orders, consumer confidence readings, housing market data, and personal income/spending reports will round out the economic picture.

Canada’s GDP figures for Q1 will also be released, expected to confirm subdued growth, consistent with recent PMI data indicating the weakest expansion since late 2023.

EMEA: Inflation Updates and Consumer Sentiment

Preliminary inflation data for May will be updated for France, Italy, Spain, and Germany, with early indicators from PMI suggesting easing price pressures, notably in France where output prices declined for the first time in four months. Germany has also seen inflation moderation.

Consumer confidence data from Germany’s GfK institute will be published, with flash PMI Future Output data signaling a modest recovery in eurozone business optimism, although sentiment remains historically low.

Türkiye’s Q1 GDP release will be another important datapoint, contextualizing regional growth amid geopolitical and economic challenges.

Asia-Pacific: Monetary Policy and Industrial Data

The Reserve Bank of New Zealand and Bank of Korea meetings will be closely monitored, with markets pricing in potential rate cuts amid persistent trade uncertainty.

Australia’s CPI data will be reviewed for signs of inflationary pressure changes.

Mainland China’s NBS PMI will reflect manufacturing sector resilience or contraction. India’s GDP figures will be essential in assessing economic momentum.

Japan’s economic data releases—covering consumer confidence, unemployment, retail sales, industrial output, and housing starts—will further characterize the challenges faced, as recent PMI data showed a contraction in business activity.

Final Thoughts: Navigating Uncertainty Amid Global Economic Challenges

The week ahead will be crucial in refining economic outlooks for major economies amid the interplay of inflationary pressures, trade tensions, and monetary policy responses.

Market participants and policymakers alike will seek to gauge the persistence of inflation, the durability of growth, and the timing of central bank actions in an environment still marked by uncertainty.

By closely analyzing the breadth of data—ranging from GDP revisions and inflation gauges to consumer confidence and industrial production—better-informed decisions can be made to anticipate the economic trajectory for the remainder of 2025.