The Week Ahead: April 7-13, 2014

April 6, 2014 11:15 PM

via a special arrangement with Informa Economics, Inc.

FY 2015 budget | Unemployment insurance | Tax incentives | CFTC nominations | Advanced biofuels

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

As Congress looks to the 17-day spring break at the end of the week, lawmakers will again say they have a "rushed" schedule to work on items that have lingered in both chambers for months. Those include restoring long-term unemployment insurance, of which a five-month extension may pass the Senate but action is not likely at this juncture in the House. Budget hearings remain the focus for USDA, US AID and other agencies’ spending plans. The Senate Ag Committee will hold a hearing on advanced biofuels and will also take a vote on nominees for the Commodity Futures Trading Commission (CFTC). The futures regulator is essentially down to 2 members with officials departing this year. And on Tuesday, the House Ways and Means panel holds a hearing on lapsed tax extenders.

The House will vote later in the week on Budget Committee Chairman Paul Ryan's (R-Wis.) proposed GOP spending plan for FY 2015, which begins Oct. 1. That is another one-chamber issue, as the Senate has no plans to take it up. In fact, Senate Democratic leaders have stated they won't won't pass a budget resolution this year as spending levels were set in the December budget deal.

Secretary of State John Kerry will testify before the Senate Foreign Relations Committee on Tuesday on the national security and foreign policy priorities in the president's budget request.

Health and Human Services Secretary Kathleen Sebelius will testify Thursday before the Senate Finance Committee on the president's budget proposal.

The House Armed Services Committee will hold a hearing Tuesday on the Russian military and strategic implications. The Intelligence Subcommittee will also hold a hearing on combatting weapons of mass destruction.

On the tax policy front, and just in time for the April 15 filing deadline, the Senate Finance Committee will hear Tuesday from top officials of the IRS and representatives of tax-preparation companies on how taxpayers can be protected from "incompetent and unethical" operators who offer to file their returns. Meanwhile, the House Ways and Means Committee on Tuesday will debate problems caused for employers by extending tax incentive provisions for short periods. And, the Senate Finance Committee has been considering a bill to restore some of the 55 provisions in the tax code that expired Dec. 31.

Two nominations will be considered Tuesday by the Senate Commerce Committee: Elliot F. Kaye to be chairman of the Consumer Product Safety Commission and Joseph Mohorovic to sit on the commission. Kaye is currently the CPSC's executive director and Mohorovic is an executive at Intertek's North America Consumer Goods division.

Federal Reserve: Capital requirements for the nation's biggest banks will be considered Tuesday afternoon by the Federal Reserve Board. The Fed, along with the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency, want the eight largest financial institutions, including JPMorgan Chase and Citigroup, to maintain equity capital equal to 6 percent of their total assets. The proposed rule would go farther than what is required by an international agreement, Basel III, aimed at strengthening big banks for economic downturns.

Focus on USAID. On Wednesday, Rajiv Shah, the administrator for the US Agency for International Development (USAID), testifies on the international development priorities in the president's budget request before the House Foreign Affairs Committee on Wednesday and before Senate Foreign Relations on Thursday.

EPA topic of several hearings. The House Energy and Water Development Appropriations Subcommittee on Tuesday is set to review the Obama administration's Fiscal 2015 budget proposal for the Energy Department and the Environmental Protection Agency. On Wednesday, the sister subcommittee in the Senate will hold a similar hearing. Also Wednesday, the Senate Interior and Environment Appropriations Subcommittee will also consider the EPA proposed budget.

The Senate Environment and Public Works Committee on Tuesday will consider the nomination of Janet McCabe, the EPA official who will do most of the heavy lifting on President Obama's climate action plan, to head the Office of Air and Radiation. McCabe, the former deputy in the office, has been acting air chief since this summer but is seeking her formal confirmation—a process sure to be dogged with questions from Republicans about the administration's pollution-reduction plans.

EPA Administrator Gina McCarthy will discuss the agency's plans to reduce greenhouse-gas emissions from existing power plants Monday at a workshop hosted by the Bipartisan Policy Center and the National Association of Regulatory Utility Commissioners.

Advanced biofuels. The Senate Agriculture Committee will meet Tuesday to discuss the development and economic potential of advanced biofuels, including testimony from former NASCAR driver and team owner Richard Childress.

President Obama's schedule this week. On Monday, the president will hold an event on the economy in Prince George's County in suburban Maryland. He will follow that up with an economy-themed White House event on Tuesday. The next day, Obama and the first lady will depart for a two-day trip to Texas. On Wednesday, the president will attend a pair of Democratic fundraisers in Houston and the following day, he will join former Presidents Carter and Clinton in speaking at the Lyndon B. Johnson presidential library to mark the 50th anniversary of the 1964 Civil Rights Act. On Friday, Obama travels to New York to address the convention of the American Action Network.

Fed officials will capture attention in the week ahead as several are on tap to speak. Monday will see comments from St Louis Fed’s Bullard, with Tuesday remarks from Minneapolis Fed’s Kocherlakota and Philadelphia Fed’s Plosser. Chicago Fed’s Evans and Gov. Tarullo mark remarks on Wednesday and Evans appearing again on Thursday. Much of the attention will be on their respective readings on the US economy and on whether they see the Fed sticking to its current path on tapering the asset purchase effort. But the other Fed focal point will come on Wednesday with release of the FOMC minutes from the March meeting. The attention there will be on any discussion of when the Fed members see interest rates rising.

On the economic data side, Monday opens with Consumer Credit followed by wholesale trade on Wednesday. Thursday’s releases include weekly jobless claims, Import/Export Prices and the monthly Treasury Budget statement while the week wraps up on Friday with PPI and Consumer Sentiment data. Otherwise, financial markets will continue to watch Chinese data and any stimulus efforts they detail and euro zone data could also be of note. The Russia/Ukraine situation is fading somewhat from market focus, but it would not take a lot to have it right back front and center.

For agriculture, the week opens with the return of the US-level Crop Progress report, which is expected to show a major decline in winter wheat ratings compared to the last US-wide update from November. Wednesday’s USDA monthly update on the balance sheets has traders watching how USDA adjusts things to accommodate the usage figures from the Grain Stocks data. Plus, this is the final month of S/D data before the first 2014/15 updates are published in May. The weekly export update on Thursday will also be important, especially for corn and soybeans and whether or not China or other countries cancel additional purchases. Beyond that, with wheat slipping lower into the weekend, another key this week will be whether showers arrived as forecast in dry areas of Plains HRW wheat locations.

Monday, April 7
Markets in China are closed for Tomb Sweeping Holiday.
Defense Secretary Chuck Hagel
is in China through Thursday.
Global Water Summit in Paris considers the impact of climate change. The theme is growth and water’s role in economic recovery (to April 8).
European Central Bank Vice President Vitor Constancio presents the ECB annual report for 2013.
Bank of Japan holds a two-day monetary-policy meeting.
Federal Reserve: St Louis Federal Reserve Bank President James Bullard speaks on monetary policy and the economic outlook,in Los Angeles.
EPA Administrator Gina McCarthy
delivers a keynote address to a workshop convened by the Bipartisan Policy Center and the National Association of Regulatory Utility Commissioners at the Grand Hyatt in Washington, D.C.
USDA Secretary Tom Vilsack delivers remarks at the North American Agricultural Journalists luncheon in Washington, D.C.
EPA Administrator Gina McCarthy will also speak to the group.
Economic reports: Selected Interest Rates (Federal Reserve) | Consumer Credit
USDA reports: Export inspections (AMS) | Amber Waves magazine (ERS) | Crop Progress (NASS)


Tuesday, April 8
Australia-S. Korea free trade deal signed:
Australian Prime Minister Tony Abbott visits South Korea during a regional tour for summit talks with President Park Geun-hye and the signing of a free-trade agreement in Seoul. The deal was concluded after six years of talks.
Federal Reserve: Minneapolis Federal Reserve Bank President Narayana Kocherlakota speaks in Rochester, Minnesota. Philadelphia Federal Reserve Bank President Charles Plosser speaks on prudential regulation, in Philadelphia.
Expired tax incentives:
House Ways and Means Committee hearing to discuss expired tax provisions with an emphasis on how permanent tax policy could promote certainty for businesses.
National security, foreign policy: Secretary of State John Kerry will testify before the Senate Foreign Relations Committee on the national security and foreign policy priorities in the president's budget request.
Russian military and strategic implications: House Armed Services Committee hearing on the Russian military and strategic implications.
CFTC nominations:
Senate Agriculture Committee business meeting to consider three nominees to serve on the Commodity Futures Trading Commission.
Advanced biofuels: Senate Agriculture Committee hearing. Witnesses include: Richard Childress, CEO of Richard Childress Racing; Jan Koninckx, global business director for biorefineries at DuPont Industrial Biosciences; Brooke Coleman, executive director of the Advanced Ethanol Council; Sumesh Arora, vice president of Innovate Mississippi; and Nancy Young, vice president of environmental affairs for Airlines of America.
FY 2015 budget – USDA: House Ag Appropriations Subcommittee hearing on the administration's FY 2015 budget request for USDA field agencies. Witnesses include: Michael Scuse, under secretary for Farm and Foreign Agriculture Services; Juan Garcia, Farm Service Agency administrator; Phil Karsting, Foreign Agriculture Service administrator; Brandon Willis, Risk Management Agency administrator; Jason Weller, chief of the Natural Resources Conservation Service; and Michael Young, USDA budget officer.
Economic reports: ICSC-Goldman Store Sales | JOLTS | NFIB Small Business Optimism Index |

Wednesday, April 9

International Monetary Fund releases its annual Global Financial Stability Report.
Federal Reserve: Chicago Fed President Charles Evans speaks on Fed communications, in Washington. Federal Reserve Gov Daniel Tarullo dinner speech in Washington.
USDA Secretary Tom Vilsack delivers remarks at the Council on Foreign Relations in New York City.
FY 2015 budget – EPA: Senate Appropriations Committee's Subcommittee on Interior, Environment, and Related Agencies hearing to discuss the administration's FY 2015 budget request for EPA. EPA Administrator Gina McCarthy is scheduled to testify.
Taxes and small businesses: House Small Business Committee hearing on "The Biggest Tax Problems for Small Businesses".
Energy reports: Weekly Petroleum Status Report (EIA) | Weekly ethanol plant production (EIA).
Economic reports: Weekly Mortgage Rates (Freddie Mac) | ICI weekly money market mutual fund data Weekly mortgage applications (Labor Dept.) | Wholesale Trade | MBA Purchase Applications
USDA reports: Weekly Weather and Crop Bulletin (WAOB) | Crop Production (NASS) | WASDE (ERS/WAOB) | World Agricultural Production (FAS) | Oilseeds: World Markets and Trade (FAS) | Grains: World Markets and Trade (FAS) | Cotton: World Markets and Trade (FAS) | Aquaculture Data (ERS) | National Dairy Products Sales Report (AMS) | Broiler Hatchery (NASS) | Season-Average Price Forecasts (ERS)


Thursday, April 10
Treasury Secretary Jack Lew takes part in a conversation at the Bertelsmann Foundation conference in Washington.
Bank of England announces its interest-rate decision.
Federal Reserve: Chicago Fed President Charles Evans on panel discussing central banking after the recession, in Washington.
World Bank head Jim Yong Kim speaks ahead of the IMF/World Bank spring meeting.
G20 ministers meet: G20 finance ministers and central bank governors meet in Washington (to April 11).
USDA Secretary Tom Vilsack delivers remarks at the National Action Network National Convention in New York City.
Electric grid: Senate Energy and Natural Resources Committee will hold a hearing on "Keeping the lights on - Are we doing enough to ensure the reliability and security of the US electric grid?"
Transportation: Weekly Traffic of Major Railroads (Assn. Of American Railroads) | Grain Transportation Report (AMS).
Energy reports: Weekly US underground natural gas stocks (EIA)
Economic reports: Jobless Claims (Labor Dept.) | Import and Export Prices | Treasury Budget
USDA reports: Export Sales (FAS)


Friday, April 11
Economic reports: Producer Price Index | Consumer Sentiment | Michigan inflation expectations
USDA reports: Oil Crops Outlook (ERS) | Wheat Outlook (ERS) | Cotton and Wool Outlook (ERS) | Feed Outlook (ERS) | Rice Outlook (ERS) | Peanut Prices (NASS) | Historical Track Records Crop Productions (NASS)


NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.



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