The light economic data calendar in the March 18 week will leave plenty of room for markets to focus on the results of the Tuesday-Wednesday FOMC meeting and Chair Jerome Powell’s press briefing. At present it would appear that the risks to the economic outlook have diminished. Business and consumer confidence, while less glowing, are still quite healthy in an historical context. Fed policymakers will have a better selection of more current data to assess the outlook now that the data release schedules are largely back on track. On the first day of spring, Powell and the Committee may find the economic climate a bit warmer that they did in January.
For the full Whetstone Analysis preview of the March 29-10 FOMC meeting, see the comment from March 17.
The week is bookended by data on the housing market. The NAHB/Wells Fargo Housing Market Index for March at 10:00 ET on Monday may extend the mild upward moves of the past two months to a third. Moderation in the pace of price increases, continued gains in income, and a welcome decline in mortgage interest rates should continue to contribute to encouraging consumers to get a jump on the spring homebuying season before limited supplies of the more sought-after units are gone. The NAR data on existing home sales for February at 10:00 ET on Friday will help confirm that if things that are driving a more optimistic outlook for housing in fact resulted in higher numbers of sales in the prior month.
Initial jobless claims for the week ended March 16 at 8:30 on Thursday could be a little noisy as some school districts go into their annual spring break period and support workers are laid off. The arrival of a major blizzard in the Midwest could mean layoffs as well. Then there’s the issue of the late timing of the Easter (April 21) and Passover (starts April 19) holidays in 2019 relative to 2018 (April 1 and started March 30). Some workers who are normally laid off temporarily for the holiday will not see a separation yet.
The data on state unemployment and employment for February is at 10:00 ET on Friday. The January data was released on Monday, March 11 and included the annual revisions. The next report will provide some insights into the details of the national Employment Situation report from March 8.
New orders for factory goods in January at 10:00 ET on Tuesday are a bit old in the wider scheme of the economic data, but this is the last report before the numbers are caught up next month. The already reported new orders for durable goods (up 0.4%) will get some backup from nondurables where higher petroleum prices should improve the overall picture.
The data on monthly wholesale trade for January at 10:00 ET on Friday is also not the freshest, but it will fill out the data on all business inventories in the first quarter 2019 along with the factory inventory number from Tuesday.
The Conference Board’s Leading Economic Index for February at 10:00 ET on Thursday will incorporate the interim report from March 4 that brought the index up-to-date with the numbers delayed during the partial federal government shutdown. Declines in jobless claims, higher confidence, mild stock market gains, and improvements in orders should all contribute to a modest increase.
There are a couple of District Bank surveys out in the week. The Philadelphia Fed’s Manufacturing Business Outlook for March is at 8:30 ET on Thursday. Most regions have reflected uneven activity in the past few months, and the Philadelphia general business conditions index was no exception with a drop to -4.1 in February after 17.0 in January. It should recover back to a modestly expansionary reading. The New York Fed’s Business Leaders Survey for March at 8:30 ET on Monday is the first of the regional reports on activity in non-manufacturing. Last month the index rebounded to 13.7 in February after a shutdown-induced 0.0 in January. Some of that is likely to fade in March, but it should remain in line with mild expansion.
The Commerce Department will release its delayed quarterly service sector data on Thursday at 10:00 ET. At this point the fourth quarter numbers are not very current, but they should provide a look at how services overall fared at a time when activity was slowing in the broader economy.
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