The Week Ahead: March 24-30, 2014

March 24, 2014 03:34 AM

via a special arrangement with Informa Economics, Inc.

Russia-Ukraine focus | FY 2015 budget hearings | Fed appearances | Hogs & Pigs report

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

The House and Senate return from their latest break, with key issues including a Ukraine aid package, including sanctions on Russia. The chambers must resolve differences on these matters. Meanwhile, a host of hearings regarding the Fiscal Year 2015 budget will take place during the week. President Obama will spend most of the week overseas (see separate box for details of President Obama's agenda).

Reforms to the International Monetary Fund (IMF) supported by the Senate and President Obama are among the major differences in how the Senate and House are approaching the Ukraine/Russia situation. House GOP leaders and conservatives oppose the changes, and the IMF proposals were left out of a House bill unveiled on Friday. The Senate bill backs an administration call to shift $63 billion from an IMF crisis account to its general fund. The Senate will consider its bill (S 2124) that would provide a $1 billion loan guarantee for Ukraine and $150 million in direct aid. The bill contains sanctions against Russians and Ukrainians deemed responsible for the unfolding crisis, as well as an increase in US funding of the International Monetary Fund. The House may take up its own Ukraine aid bill (HR 4278) later in the week – the House Foreign Relations Committee meets Tuesday morning to mark up the Ukraine aid bill.

Another short-term "doc fix" of nine months to a year is likely regarding an approach to paying Medicare physician. Congress must act by March 31 to avert an automatic cut to those payments.

The Senate may also consider legislation to restore emergency unemployment benefits for five months. A group of senators March 13 announced that an agreement on the measure was reached.

House action this week includes a bill (HR 4275) that would provide for cooperative and small employer charity pension plans, and a bill (HR 3771) to speed up the income tax benefits for charitable cash donations for the victims of the Typhoon Haiyan. The chamber will also debate a bill (HR 2824) that would loosen requirements for depositing waste or coal ash near streams, and a bill (HR 1459) to limit the number of monuments a president could designate in a four-year term.

Congressional hearing topics this week include FY 2015 budget requests for federal departments and agencies, international finance, energy exports, Medicare fraud and the patent system.

Secretary of State John Kerry will testify Tuesday before the Senate Foreign Relations Committee on the national security and foreign policy priorities in the president's budget proposal. The Foreign Relations Committee also holds a hearing on Syria on Wednesday.

Treasury Secretary Jacob Lew will appear Tuesday before the House Appropriations Committee, and on Wednesday before the House Financial Services Committee on the state of the international financial system.

The House Financial Services Committee on Tuesday will hold the first in a planned series of hearings on the $17 trillion national debt. This hearing is to examine the debt's impact on jobs, economic growth, and the ability of the nation to fund entitlement programs and discretionary spending.

Advocates of exporting natural gas will accelerate their efforts, ready to make their case before Congress that surging US gas production should open the door for exports that help Europe ease reliance on Russian energy. On Tuesday the Senate Energy and Natural Resources Committee will have a hearing on the topic. A day later the House Foreign Affairs Committee will have a hearing on the "Geopolitical Potential of the US Energy Boom."

In hearings before the Appropriations panels, scheduled witnesses include Treasury's Lew, FBI Director James Comey, USDA Secretary Tom Vilsack, Capitol Police Chief Kim Dine, Interior Secretary Sally Jewell, Labor Secretary Thomas Perez, Federal Communications Commission Chairman Tom Wheeler, and Environmental Protection Agency Administrator Gina McCarthy, among others.

The Russia/Ukraine situation will continue as a potential market flashpoint for a host of markets, from financial to ag commodities. Any additional flare-ups could easily affect markets as we witnessed this week. In addition, more Fed speakers appear this week and given how their post-FOMC remarks have

As for economic data, the calendar fills up as we near the end of March. Monday will see release of the Chicago Fed report and the PMI Manufacturing Flash Index, with Tuesday updates via the FHFA House Price Index, S&P Case-Shiller Home Price Index, New Home Sales, Consumer Confidence and the Richmond Fed manufacturing update. Wednesday’s releases include Durable Goods and the PMI Services index while Thursday will bring the final reading on fourth quarter 2013 GDP, weekly jobless claims and the Pending Home Sales Index. Wrapping up the week on Friday will be Personal Income and Outlays and Consumer Sentiment figures.

Every day this week features at least one Fed appearance, with Gov. Stein on Monday along with Dallas Fed’s Fisher. Tuesday will seek remarks from Philadelphia Fed’s Plosser and Atlanta Fed’s Lockhart, with St Louis Fed’s Bullard appearing on Wednesday. Thursday’s schedule includes Cleveland Fed’s Pianalto and Chicago Fed’s Evans, with KC Fed’s George scheduled to speak on Friday. Markets will continue to monitor the Fed comments for any hints there has been a change.

For agriculture, Ukraine and Plains HRW wheat area weather along condition rating updates will be key for wheat futures as they only have to wait until April 7 for the US Crop Progress report to return. USDA will update their forecasts for food prices on Tuesday, with the weekly export update on Thursday followed by Ag Prices and the quarterly Hogs & Pigs report on Friday. Beyond that, traders will keep watching developments relative to US corn exports to China and whether any additional soybean trade shifts take place.

President Barack Obama's schedule for the week of March 24, 2014:

On Monday, President Obama will arrive in The Netherlands. In the morning, he will tour the Rijksmuseum and hold a bilateral meeting with Prime Minister Rutte of The Netherlands. In the afternoon, Obama will participate in a bilateral meeting with President Xi Jinping of China at the United States Ambassador's residence before arriving at the World Forum to participate in the Nuclear Security Summit. In the evening, the president will attend a G7 leaders meeting on Ukraine at Catshuis, the official residence of the Prime Minister. Afterwards, he will join His Majesty King Willem-Alexander for dinner at the Royal Palace.

On Tuesday, President Obama will visit the World Forum to participate in the Nuclear Security Summit. Afterwards, he will hold a bilateral press conference with Prime Minister Rutte. In the evening, Obama will participate in a bilateral meeting with the Crown Prince of Abu Dhabi, Mohammed Bin Zayed Al Nahyan of the United Arab Emirates, at the United States Ambassador's residence, and a trilateral meeting with President Park Geun-Hye of the Republic of Korea and Prime Minister Shinzo Abe of Japan. He will then meet with employees and family members of the US Embassy to The Netherlands. The president will then travel to Brussels, Belgium where he will remain overnight.


On Wednesday, the President will visit Flanders Field Cemetery with Prime Minister Elio Di Rupo of Belgium and His Majesty King, Philippe. In the afternoon, he will participate in the EU-US Summit at the Council of the European Union. Afterwards, the president will meet with employees and family members of the US Tri-Mission to Belgium, EU, and NATO before meeting with NATO Secretary General Anders Fogh Rasmussen. In the evening, Obama will deliver remarks at The Centre for Fine Arts (BOZAR) and then travel to Rome, Italy where he will remain overnight.


On Thursday, President Obama will visit the Vatican where he will meet with His Holiness Pope Francis followed by a meeting with Vatican Secretary of State Cardinal Pietro Parolin. Afterwards, the president will participate in a bilateral meeting with President Giorgio Napolitano of Italy at the Quirinal Palace. Later, Obama will participate in a bilateral meeting and joint press conference with Prime Minister Matteo Renzi of Italy at Villa Madama. In the evening, the president will tour the Colosseum and meet with employees and families of the US Tri-Mission to Italy, The Holy See, and the UN Agencies in Rome.


On Friday, the president will travel from Rome, Italy to Riyadh, Saudi Arabia. While in Saudi Arabia, Obama will participate in a bilateral meeting with His Majesty Abdullah bin Abdulaziz Al Saud of the Kingdom of Saudi Arabia. The president will remain overnight in Saudi Arabia.



Monday, March 24
Congress: The House and Senate return.
Ukraine: Senate votes on a $1 billion loan guarantee package for Ukraine.
World leaders, including President Obama and China's Xi Jinping, attend the Nuclear Security Summit in The Hague, through Tuesday.
Japanese Prime Minister Shinzo Abe, Malaysian Prime Minister Najib Razak speak at Credit Suisse Asian Investment Conference in Hong Kong, runs through Friday.
Economic reports: Selected Interest Rates (Federal Reserve) | Chicago Fed National Activity Index | PMI Mfg Index Flash
USDA reports: Export inspections (AMS)


Tuesday, March 25
Federal Reserve: Philadelphia Fed President Charles Plosser speaks before the Money Marketeers of NYU. Atlanta Fed President Dennis Lockhart speaks on the economic outlook in Atlanta.
Arab League holds its annual summit in Kuwait through Wednesday.
Energy reports: Weekly National Petroleum Report (API).
Economic reports: S&P Case-Shiller HPI | FHFA House Price Index | New Home Sales | Consumer Confidence | Richmond Fed Mfg Index | ICSC-Goldman Store Sales
USDA reports: Food Price Outlook (ERS) | Cotton Ginnings (NASS) | Poultry Slaughter (NASS) | Agricultural Exchange Rate Data Set (ERS)

Wednesday, March 26

President Obama to Brussels for EU-US summit on situation in Ukraine.
IMF: Treasury Secretary Jacob Lew testifies at a House Financial Services Committee hearing on the International Monetary Fund (IMF).
Federal Reserve: In Hong Kong, St. Louis Fed President James Bullard participates in a panel called "Central banks—Will policy making ever be conventional again?"
Energy reports: Weekly Petroleum Status Report (EIA) | Weekly ethanol plant production (EIA).
Economic reports: ICI weekly money market mutual fund data | MBA Purchase Applications | Weekly Mortgage Rates (Freddie Mac) | Durable Goods Orders |
USDA reports: National Dairy Products Sales Report (AMS) | Broiler Hatchery (NASS) | Price Reactions After USDA Reports (NASS) | Dairy Data (ERS) Milk Cost of Production Estimates (ERS)


Thursday, Feb. March 27
President Obama, in Rome, meets with Pope Francis. He will also hold talks with Italian Prime Minister Matteo Renzi.
Federal Reserve: Chicago Fed President speaks at Credit Suisse Asian Investment Conference. Cleveland Federal Reserve President Sandra Pianalto speaks to RISE student conference at the University of Dayton, Ohio.
Energy reports: Weekly US underground natural gas stocks (EIA).
Economic reports: Jobless Claims (Labor Dept) | GDP | Pending Home Sales Index | KC Fed Mfg Index
Transportation: Grain Transportation Report (AMS).
USDA reports: Weekly Export Sales (FAS) | Peanut Stocks and Processing (NASS) | Vegetables-Annual (NASS) | US Food Imports (ERS) | Livestock & Meat Domestic Data (ERS)

Friday, March 28

Federal Reserve: Kansas City Federal Reserve President Esther George speaks on the economy in Kansas City.
Economic reports: Employment | Personal Income and Outlays | Consumer Sentiment
USDA reports: Quarterly Hogs and Pigs (NASS) | Agricultural Prices (NASS) | Peanut Prices (NASS) | Rice Yearbook Data (ERS)


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






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