RAn U.S. Weekly Outlook

The U.S. economic data flow will moderate a bit this week, after a full calendar in the previous week. That doesn’t mean the importance of the data will do the same though. Last week’s FOMC policy statement was a clear indication that every single piece of data will be important to the outlook for monetary policy ahead of the December meeting. While the FOMC statement was a bit more hawkish than many market participants would have liked, there was nothing in the statement that indicated that the FOMC would not be willing to ease policy again in December, although there was nothing there that said it would either. Last week we saw the release of the October Employment Report, which reinforced our view that outside of the housing market weakness, there have been no clear indications of a major slowdown.

The blackout period ended on Friday, and the first Fed-speaker in this inter-meeting period that comes is Frederic Mishkin (Board of Governors, voter), who speaks on derivatives on Monday afternoon, London time. ISM non-Manufacturing on October will be released on Monday as will the Senior Loan Officer Survey, where we’ll probably see more negative news on the mortgage/credit market. Fed’s Kroszner (Board Of Governors, voter) speaks at 1700 on subprime mortgages. The Tuesday calendar will be filled with a speech by Fed Chairman Bernanke at 1730, the weekly chain store sales data where we’ll be looking for exactly how strong or weak the Halloween sales where. Finally, we’ll have the release of the ABC News/Washington Post Consumer Comfort Index.

Wednesday brings us Fed’s Lacker (Richmond, non-voter), who speaks on the role of the central bank at 1345. Fed’s Warsh (Board of Governors , voter) speaks at 1700, Lockhart (Atland, non-voter speaks at 1810. Datawise, we’ll see the quarterly Non-Farm Productivity report at 1330, September Wholesale Inventories at 1345 and Consumer Credit at 2000. On Thursday, we’ll see Initial Jobless Claims and more chain store sales data. Fed’s Bernanke speaks at the JEC at 1500.

The data calendar finishes up on Friday with the release of the September Trade Balance, the October Import Price Index both at 1330. We’ll also see the release of the November Preliminary U. Michigan Consumer Confidence Index and the IBD/TIPP Economic Optimism Index for November.

In terms of supply, we’ll see the results of the $13.0 billion 10-year note auction on Wednesday and the $5.0 billion 30-year reopening on Thursday. Both at 1800.