The focus this week will be on US data, Fed speeches, and the passage of the next US stimulus bill through the House of Representatives.
The main data releases in the US include personal income, expenditure, and prices for Jan, the final read on consumer sentiment for Feb, the second estimate of Q4 US GDP, and a further read on manufacturing conditions throughout the US. Tracking initial claims trends continue to be in focus – and new claims remain stubbornly high.
There will be several notable Fed speeches this week including US Fed Chair Powell providing semi-annual testimony to the House of Representatives and the Senate, Vice Chair Quarles, Vice Chair Clarida, and Governor Brainard on the Fed’s maximum employment mandate.
The latest proposed US stimulus and relief bill is expected to start its passage through the US House of Representatives. Some key measures include a $1400 one-off payment (for those on <$75k year) and the extension of targeted unemployment benefits through to August.
There will also be several important Aus data releases this week including the Q4 wage price index and Q4 private sector Capex results.
The US Fed plans to purchase $22.37bn in US Treasury securities (last week/short week $17.8bn). The Fed will also purchase $32.45bn in MBS ($24.1bn last week). The target for the monthly increase in Fed holdings of MBS is at least $40bn/mth.
US Treasury issuance will be lighter this week and the US Treasury has also ceased issuance of the 15, 17, and 22 wk CMBs – resulting in a larger paydown. The US Treasury will settle approx. $269bn in ST Bills, 30yr TIPS, and 2yr FRN’s this week. As a result, the paydown will be -$60.9bn. The US Treasury will also auction $210bn in Notes and Bonds this week which will settle next week.
This week, approx. $21.8bn in Bills will mature on the Fed balance sheet and will be rolled over.
More detail (including a calendar of key data releases) is provided in the briefing document – download the file here;
Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net
