A quiet week on the data front with the prelim PMI’s for Apr and US housing data for Mar the key highlights for the week.
There will be less activity on the central bank front this week too. The main events are the ECB rates and policy meeting on Thur and the release of the RBA minutes of the Apr meeting.
The US FOMC meets next week (27-28 Apr), so there will be no Fed speakers ahead of that meeting. The FOMC is not expected to change policy settings at this stage. But there is some anticipation around how the messaging might start to evolve over the next few meetings – especially given how the data is progressing. While spending data came in stronger last week, this was still on the back of significant stimulus. But, so far, the labour market has started to record more notable improvements, especially the non-farm payrolls result for Mar. The initial claims across both state and federal programs are now down to 744k (last week, NSA), and continuing claims are also trending lower (still elevated at over 16m people though).
The important data releases for the week;
The initial read on Apr private sector growth momentum with the prelim PMI’s for major economies.
The US existing home and new home sales data for Mar. Existing home sales for Mar are expected to come in a little lower at 6.18m (SAAR) compared to 6.22m for Feb. New home sales are expected to jump to 885k (SAAR) in Mar compared to 775k in Feb.
Australia prelim retail sales for Mar.
Finally, the National CPI for Japan (Mar) will also be released this week.
QE purchases this week: The US Federal Reserve will purchase approx. $21bn in US Treasury securities this week (last week approx. $18bn) and approx. $31bn in MBS (last week approx. $27bn).
US Treasury issuance will be lighter this week. The US Treasury will settle approx. $300bn in ST Bills this week, with a net paydown of -$43bn for the week.
The US Treasury will also auction the 5yr TIPS and 20year Bond this week and both will settle next week.
This week, approx. $24bn in ST 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
