The Week Ahead: December 19-25, 2016

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Lawmakers are gone, with a new Congress in January, while both President Barack Obama and President-elect Donald Trump have begun their holiday vacations.

Staffing the Trump administration will be the focus in Florida, where Trump is vacationing, with a few positions left open ahead of the weekend -- Trump announced his Office of Management (OMB) pick Saturday, tapping arch conservative Rep. Mike Mulvaney (R-S.C.). Open positions include USDA Secretary and the US Trade Representative, both important posts for agriculture.

The USDA top spot has had several names floating in and out of the headlines, so getting a choice may still end up being a surprise. The process of getting a reading on what the officials selected to date will do once they are confirmed continues as the direction the agencies go hinges in part on those put in charge of the various agencies.

After the flurry of trade-related actions the past week, things should be quieter on the trade policy front.

Economic updates are clustered on Thursday, with some key updates arriving that day. The week will start with the PMI Services reading on Monday with Existing Home Sales next up on Wednesday. The barrage of releases on tap for Thursday includes Retail Sales, GDP, Weekly Jobless Claims, Chicago Fed National Activity Index, FHFA House Price Index, Personal Income & Outlays, Leading Indicators and the Kansas City Fed Manufacturing Index. The week wraps up ahead of the holiday with the New Home Sales and Consumer Sentiment updates.

While the attention will be on how the data stacks up to the recent Fed projections, unless data comes in a lot softer than expected, it won’t change the market reading on interest rate increases ahead. And the volume of trade will decline over the course of the week as the holiday gets closer and closer as traders opt to make a longer holiday weekend.

Trading hours ahead. Even as Friday December 23 marks the last day before Christmas, not a lot of financial markets have adjusted trading hours at this stage. The recommendation is now for the bond market to close at 1 p.m. CT, but other markets are likely to observe normal trading hours.

The Fed-related schedule is very light, though the main attention will be on Monday’s remarks by Fed Chairwoman Janet Yellen as she delivers remarks on the future of the jobs market at the mid-year commencement ceremonies at the University of Baltimore.

She is not likely to delve into monetary policy in such a forum and may well echo her views that the slack is declining in the US jobs market. So her guidance to those graduating will likely be to point out they are coming out of college with a relatively strong job market in place.

Foreign demand remains the focus and traders will want to see how or whether a rising US dollar is impacting demand from foreign buyers for US ag goods. Sales of soybeans have been strong, but the expectation is they will start to slow as the availability of South American supplies get closer and closer. That puts the weekly Grain Inspections update on Monday and Weekly Export Sales figures on Thursday as key focal points for traders. Beyond those updates, USDA will release its forecast for food prices on Thursday and the week closes out with a series of meat-related reports that will all come out at 11 a.m. CT – Cold Storage, Cattle on Feed and Hogs & Pigs. Those reports arrive earlier than usual as USDA typically tries to button things up early ahead of Christmas.

Unlike most financial markets, grain and livestock markets will close early – livestock markets at noon CT and grains/soybeans at 12:05 p.m. CT.

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