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(Bloomberg) --

The Federal Reserve may take comfort that tariffs have yet to materially boost official inflation readings, but policymakers will continue to suggest interest rates are on hold until they better understand the coming impact of US trade policy.

Figures on Friday are projected to show the US personal consumption expenditures price index excluding food and energy — the Fed’s preferred gauge of underlying inflation — probably rose 0.1% in April after no change a month earlier, based on a Bloomberg survey.

While the impact of President Donald Trump’s tariffs on April price data will be modest, the trade-policy fingerprints are expected to become more apparent as soon as next month, according to many economists. And with the job market showing few signs of outright stress, Fed officials are content to keep interest rates steady until trade policy changes are reflected in the data.

Wednesday’s release of minutes from the Fed’s meeting earlier this month may reinforce that approach, as could speeches from regional Fed presidents including Neel Kashkari and John Williams. Chair Jerome Powell gives baccalaureate remarks at Princeton University on Sunday.

At the same time, US economic growth is expected to cool over the course of the year, with many businesses becoming more guarded about the outlook as tariffs boost costs and weigh on consumer sentiment. The government’s price figures will be accompanied by a fresh read on household demand.

Economists anticipate outlays for goods and services rose 0.2% in April after a 0.7% March advance, excluding the effect on inflation. That indicates more restrained household spending at the start of the second quarter, a reflection of growing anxiety about personal finances and the labor market.

What Bloomberg Economics Says:

“In spite of the subdued inflation and spending, FOMC officials likely will signal they intend to stay on hold for an extended period. The common message from the slew of FOMC participants set to speak in the coming week — including Fed Chair Jerome Powell — will be that policymakers will ensure inflation expectations stay anchored.”

—Anna Wong, Stuart Paul, Eliza Winger, Estelle Ou & Chris G. Collins, economists. For full analysis, click here

The holiday-shortened week for economic data also includes the government’s second reading of first-quarter gross domestic product, April durable goods orders, and a pair of consumer confidence surveys.

In Canada, the economy appears likely to miss the Bank of Canada’s forecast of 1.8% annualized growth in the first quarter, with industry-based figures so far pointing to a 1.5% expansion in data on Friday. Canada’s head of state, King Charles III, will lay out Prime Minister Mark Carney’s priorities in a speech on Tuesday marking the opening of Parliament that will shed more light on spending plans.

Elsewhere, industrial profits in China, inflation across the euro zone, and rate cuts in South Korea and New Zealand may be among the highlights.

Asia

The wave of economic readings from Asia continues, with key growth indicators from India and Taiwan as well as central bank decisions in South Korea and New Zealand.

Observers will get a better sense of how Trump’s trade war is hitting commerce, starting with Hong Kong’s April trade data due on Monday. On Wednesday, Sri Lanka publishes trade figures for April. Thailand and the Philippines release data on April exports and imports Friday.

Production across the region, the world’s factory floor, will also be in focus. China on Tuesday is set to report industrial profits for April, an area under increased pressure as deflation and the trade war weigh. India releases industrial production figures on Wednesday, which are forecast to have slowed. And South Korea and Japan report April industrial production on Friday that are also expected to slow — and in Japan’s case contract — as demand wanes.

South Korea’s central bank is seen cutting rates on Thursday by a quarter point, to 2.5%, to support growth. They’ll follow New Zealand’s monetary authorities, which are expected to lower the key policy rate by a quarter point to 3.25% on Wednesday. South Korea also releases April retail sales and May consumer confidence in the coming week.

Japan reports a ream of data on the rest of the economy. That includes April producer prices on Monday, followed by May consumer prices for Tokyo on Friday. The jobless rate was likely unchanged in April, and retail sales on Friday are set to show that activity remained largely steady.

Other major releases include India’s first-quarter GDP reading on Friday, which is forecast to have strengthened. Australia will get April readings on consumer price inflation, which has been running hot lately, and retail sales, which are likely to remain steady.

Elsewhere, Macau on Thursday reports its hotel occupancy rate for last month, an insight into Chinese tourism in Asia’s casino capital.

Europe, Middle East, Africa

The working week will be shorter in several countries. As with the US, the UK has Monday off, while Thursday is a holiday across northern continental Europe.

With the European Central Bank lining up for a further rate cut in June, Thursday marks the start of a pre-decision blackout period for officials. Policymakers scheduled to speak before then include President Christine Lagarde on Monday, as well as governors of the French and German central banks.

Several reports in the euro region are likely to interest investors, with inflation numbers scheduled in all four of its top economies, starting with France on Tuesday. Price growth there is seen staying at 0.9%.

The other three are scheduled for Friday, with results at 1.9% anticipated in Italy and 2% in both Spain and Germany. Together, those economies account for more than 70% of the overall euro area.

If the surveys are accurate, May will mark the first time in eight months, and only the second time since 2021, that annual consumer-price growth hasn’t exceeded the ECB’s 2% goal in any of those countries.

In a quieter week for UK data, speeches by Bank of England chief economist Huw Pill on Wednesday, and Deputy Governor Sarah Breeden and Governor Andrew Bailey on Thursday, may draw the most attention.

In Switzerland, export numbers for April, when the country initially faced 31% tariffs from the US, will be released on Tuesday. Sweden’s economic tendency survey comes the same day, while the Riksbank will release its financial stability report on Wednesday. Swedish GDP numbers are due on Friday.

Also on Friday, data will likely show Turkey’s economic growth remained muted in the first quarter as the central bank sticks to high interest rates to slow inflation.

Some monetary decisions are on the calendar:

Latin America

Brazil’s mid-month consumer price report posted Tuesday is the second-to-last inflation reading before the central bank’s June meeting. The April CPI figures point to pressure on headline prints from rising food costs.

In Mexico, the central bank’s quarterly inflation report is keenly awaited: More than a few analysts expect Banxico to mark down its 2025 GDP forecast from the current 0.6%, to perhaps nearer the -0.2% lower range of its previous report.

Banxico will also publish the minutes of its May 15 meeting. While mid-May consumer prices reported on Thursday surprised to the upside, the post-decision statement’s dovish tilt suggests the board may look through the uptick.

Brazil, Chile, Colombia and Mexico will report April labor market figures.

Joblessness is drifting higher in Chile and Brazil — though below what many Brazil watchers see as the economy’s non-accelerating inflation rate of unemployment — while ticking lower in Colombia. Mexico’s March unemployment rate of 2.22% was a record low.

Closing out the week, Brazil on Friday posts first-quarter output data. Latin America’s No. 1 economy is widely forecast to slow in 2025 after three years of growing at 3% or better, though it may be hard to see in the week’s data.

The Getulio Vargas Foundation’s GDP Monitor estimated Brazil’s January-March quarter-on-quarter expansion was 1.6%, the fastest since 2020.

--With assistance from Mark Evans, Robert Jameson, Laura Dhillon Kane, Katia Dmitrieva, Monique Vanek, Piotr Skolimowski and Carla Canivete.