The Week Ahead: Dec. 16-22, 2013

December 15, 2013 09:09 PM

via a special arrangement with Informa Economics, Inc.

Senate vote on budget agreement | FOMC

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Senate leaders plan to complete debate and a vote on the budget agreement which cleared the House last week. The House is in recess until Jan. 7; once the Senate completes its work this week, the chamber will recess until Jan. 6. Other Senate action this week will include confirmation of some nominees, including Janet Yellen to be chairwoman of the Federal Reserve.

Farm bill conference principals and/or staff are expected to meet this week either formally or via teleconference in further steps to deal with lingering issues. Substantial progress was made last week on farm bill topics, with expectations that a framework agreement will be unveiled when lawmakers return in 2014. Some farm bill topics will eventually be dealt with via votes by farm bill conferees.

On the congressional hearing front, Senate Judiciary holds a hearing on patent trolls; Senate Energy and Environment has a markup and hearings on President Obama nominations; Senate Finance panel has a hearing on defined benefit plans.

Regarding the budget agreement, Senate Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.) agreed to a plan calling for lawmakers to begin holding votes today on nominations and then quickly move on to the budget, Dept. of Defense (DOD), and other matters. Reid said their goal is to wrap up work by the evening of Dec. 20. The leader agreed to a schedule for handling most of the Senate's remaining work.

Reid said lawmakers will return today and vote on the nomination of Jeh Johnson to serve as secretary of the Department of Homeland Security. After that, the Democratic leader said, the Senate will take up the budget agreement on Dec. 17. Following passage of the budget, he said, the Senate will move to the DOD bill on Dec. 18.

Reid said the plan also calls for the Senate to be in session Dec. 19, voting on another batch of Obama's nominees. At the top of that list will be the nomination of Janet Yellen to serve as chairman of the Federal Reserve, he said. Besides Yellen to serve at the Fed, Reid said he intends to work to confirm John Koskinen to be commissioner of the Internal Revenue Service before week's end. Also on the majority leader's list is Suzanne Spaulding to serve as an undersecretary of DHS, Rose Gottemoeller to serve as an undersecretary of state for arms control and international security, and Michael Connor to be deputy secretary at Interior. In addition, Reid said he may push for confirmation for Robert Wilkins to serve on the D.C. Circuit.

Besides a new farm bill, other topics bumped into 2014 include extending unemployment insurance, raising the minimum wage, renewing "fast track" trade authority, and rewriting federal water resources programs. Reid said many of those items, particularly a UI extension, will be dealt with when the Senate begins a new session in January.

While there are more pieces of economic data due out this week, the key focus will be on the Wednesday conclusion of the Federal Open Market Committee (FOMC) meeting. The conclusion of that session will also see release of updated economic projections and the final press conference held by current Fed Chairman Ben Bernanke. Besides the FOMC session, Monday will open with the Empire State manufacturing index with releases also due on Productivity and Costs, the PMI manufacturing flash index and Industrial Production. Tuesday will see the Housing Market Index released and the Consumer Price Index with Wednesday bringing Housing Starts in addition to the FOMC conclusion. Thursday’s data flow will include weekly jobless claims, the Philadelphia Fed index, Existing Home Sales and Leading Indicators. The week wraps up with the next update on third quarter GDP, Corporate Profits and the Kansas City Fed manufacturing index. Any economic updates from Europe and China could also gain attention, but the Fed focus will remain high. The Energy Information Agency will also put out its 2014 energy outlook.

For agriculture, the situation with China and their rejections of US corn shipments due to the presence of a GMO variety that China has not approved (the US and several other countries have approved it) will be a key for the corn trade. The matter is likely on the agenda late in the week when US and Chinese officials hold regularly scheduled talks on trade issues. USDA Sec. Vilsack will be a part of the discussions. South American weather will also be followed as so far things have been ideal. Demand news will be a key factor with the weekly update from USDA on Thursday morning. Thursday will also see release of Livestock Slaughter data and Friday will close out the week with the monthly Cattle on Feed report.

Monday, Dec. 16
The Bank of Japan issues its December tankan business-sentiment survey.
EU and US trade officials meet for a third round of negotiations aimed at creating the world's largest free-trade deal.
EIA to update energy forecasts to 2040: The US Energy Information Agency (EIA) presents the reference case from Annual Energy Outlook 2014 Early Release Overview with projections of US energy supply, demand, and prices to 2040. Link to webcast.
Coal outlook: The International Energy Agency produces a Medium-Term Coal Market Report with forecasts for the next five years and in-depth analysis of global demand, supply and trade. It shows its future increasingly tied to developments in non-OECD countries, led by China.
Economic reports:
Selected Interest Rates (Federal Reserve) | Treasury International Capital | Empire State Mfg Survey | Productivity and Costs | PMI Mfg Index Flash | Industrial Production
USDA reports: Export inspections (AMS) | Livestock, Dairy & Poultry Outlook (ERS) | Turkey Hatchery (NASS) | Feed Grains Database (ERS) | Sugar & Sweeteners Outlook (ERS)


Tuesday, Dec. 17
European finance ministers meet in Brussels to discuss the Single Resolution Mechanism.
Budget agreement: The Senate considers the bipartisan budget agreement, with a vote expected before the end of the week.
Germany: German Chancellor Angela Merkel could be sworn in at the Bundestag for a third term if the Social Democrats, second in September’s election, back the agreement for a "grand coalition". Christian Democrats voted on December 9 to approve a coalition with their arch-rivals. Merkel has defended the decision to accept a first-ever minimum wage.
D8: Commissioners and council ministers of the D8, the group of developing countries with large Muslim populations which works as an economic development alliance, meet in Islamabad (to December 19).
Energy reports:
Weekly National Petroleum Report (API).
Economic reports: ICSC-Goldman Store Sales | Housing Market Index | Consumer Price Index | FOMC meeting begins
USDA reports: Meat Price Spreads (ERS) | Bioenergy Data (ERS) | Weekly Weather (WAOB) | National Hop Report (NASS)


Wednesday, Dec. 18
Trade in the Asia-Pacific: Subcommittee hearing. Senate Foreign Relations — Subcommittee on East Asian and Pacific Affairs.
Energy reports: Weekly Petroleum Status Report (EIA) | Weekly ethanol plant production (EIA) | Monthly National Petroleum Report (API)
Economic reports: Weekly mortgage applications (Labor Dept.) | MBA Purchase Applications | Housing Starts | | FOMC meeting announcement | FOMC forecasts | Fed chairman press conference
USDA reports: Broiler Hatchery (NASS) | Catfish Feed Deliveries (NASS) | National Dairy Products Sales Report (AMS) | Announcement of Advanced Prices and Pricing Factors (AMS) | Broiler Hatchery (NASS) | National Dairy Products Sales Report (AMS)


Thursday, Dec. 19
Russian President Vladimir Putin gives his annual press conference in Moscow.
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.) | Phila. Fed Survey | Leading Indicators | Existing Home Sales
USDA reports: Export Sales (FAS) | Milk Production (NASS| Livestock Slaughter (NASS) | Wheat Data (ERS)



Friday, Dec. 20
The Bank of Japan announces monetary-policy decision following a two-day meeting.
Economic reports: GDP | KC Fed Mfg Index
USDA reports: Cattle on Feed (NASS) | Peanut Prices (NASS) | Catfish Feed Deliveries (NASS) | Catfish Processing (NASS)


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






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