By Theresa Sheehan

PRINCETON (SMRA) – Next week both the pace of economic data
releases and their importance to markets of the will decrease. There is
very little that has the potential to be market-moving, so there will be
plenty of time to digest the data from the March employment report.

Of more impact to markets should be the minutes from the March 16
Federal Open Market Committee meeting released Tuesday afternoon. The
second consecutive dissent from Kansas City Fed’s Thomas Hoeing will
merit a closer look, and if there is a hint his position has more
support than the first time around at the end of January.

Chairman Ben Bernanke’s recent testimony on the exit strategy has
probably covered whatever the FOMC discussed regarding the exit
strategy.

Several Fed officials will be giving lunchtime speeches as
policymakers try to reinforce the message of the importance of community
banks to the financial system, not just the big Wall Street financials.
The Minneapolis Fed’s Narayana Kocherlakota will do so Tuesday and again
Thursday. New York’s William Dudley, Kansas City’s Hoenig and Chairman
Bernanke will do so Wednesday.

On Tuesday and Wednesday the Chicago Federal Reserve will host a
conference on “Searching for the New Normal: The Rebuilding Process for
Risk Management.” Chicago Fed President Charles Evans will give the
keynote speech Tuesday morning.

While there will be nothing new from the Fed on monetary policy,
other major central banks have announcements scheduled. The Reserve Bank
of Australia makes its statement on Tuesday, and although another
increase in its cash rate was initially expected, the RBA hike is a bit
less certain now given the disappointing retail sales number this week.
Currently the rate is at 4.00%, and another 25 basis points could be
added.

Bank of Japan governors meet on Tuesday and Wednesday. Given the
recent steps to expand quantitative easing, they probably will take no
further action this week. The Bank of England’s Monetary Policy
Committee meets on Wednesday and Thursday. They will have some better
economic data to ponder, but no tightening in policy is expected, nor
are further quantitative easing steps. The ECB makes its announcement on
Thursday. While inflation remains tame, the Bank has serious issues to
contend with, including the fiscal situation in Greece and other EU
countries.

Later in the month, the Bank of Canada will meet on the 20th, and
the Reserve Bank of New Zealand on the 29th. The FOMC meets on April
27-28, at which point they will have the Senior Loan Officer Survey to
ponder and their quarterly forecast to update.

There are two economic data releases Monday morning.

The ISM Non-manufacturing Index for March will get less attention
than usual since it is being released after the employment report.
Nonetheless, it will get some scrutiny to see if the service sector is
seeing the same sort of recovery that appears to be happening on the
manufacturing side.

The NAR’s Pending Home Sales Index is supposed to signal future
activity in home sales. While it has been on the decline since the
expiration of the initial version of the tax credit for first-time
homebuyers on November 30, it is still above index levels that marked
the financial crisis. If the February reading turns higher, it will be a
hint that the second version of the homebuyer tax credit is having an
impact.

Wednesday afternoon, Consumer Credit Outstanding for February
promises to be more of the same with credit availability tight and
demand for new loans low. Demand for new auto financing should be weak.

Thursday, industry reports on same-store sales comparisons for
fiscal March will be reported as available. Better weather and more
optimistic consumers should help the general trend in spending. Weekly
measures of retail activity for March were a bit erratic along with the
weather, but on the whole sales were improving.

Earlier Thursday morning, weekly initial jobless claims for the
week ended April 3 should have more to say about conditions in the labor
market.

Late Friday morning, the data on wholesale trade for February will
provide the second of the three pieces that add up to overall business
inventories. Factory inventories are already reported up 0.5%. The
Commerce Department issued revisions to the wholesale trade data on
March 31.

The U.S. Treasury will hold four coupon auctions this week. A
reopening of 10-year TIPS notes Monday, new 3-year nominal notes
Tuesday, a reopening of 10-year notes Wednesday, and a reopening of
30-year bonds Thursday. The auctions of the 10-year nominal notes and
30-year bonds are the final leg of the first quarter refunding. The next
refunding announcement is May 5.

** Stone & McCarthy Research Associates **

[TOPICS: M$$FI$,M$U$$$,MAUDS$]