The Week Ahead: Jan. 18-24, 2016

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It is a short week ahead with US government offices and markets closed for a holiday Monday. The House is out but the Senate is in, with agriculture’s focus on any new developments in the first case of bird flue since last June confirmed Jan. 15 on an Indiana farm. Meanwhile, the Senate Ag Committee after a long delay finally will markup a child nutrition measure.

The Senate will debate settling Syrian refugees in the US, with a cloture vote scheduled Wednesday on whether to proceed to legislation the House passed last year. The bill would require top US law-enforcement and natural security officials to affirm to Congress that the individual Syrian refugee does not pose a security threat. The Obama administration contends the refugee program would grind to a halt, and has threatened to veto the measure. The Nov. 19 House vote on passage was 289 to 137, more than the two-thirds necessary to override a veto. However, two Republicans and six Democrats missed the vote, so if all members weighed in, 290 votes would be needed to override. Obama plans to resettle 10,000 refugees from Syria. Backers of resettlement say the current process already contains security safeguards.

On gun policy, Attorney General Loretta Lynch will field questions Wednesday from Senate appropriators about implementation of President Barack Obama’s executive actions on gun sales.

Although the House is not in session, top tax writers from both chambers plan to start an effort to make significant changes to international corporate taxes, Ways and Means Chairman Kevin Brady of Texas said. However, Brady said he was uncertain whether a bill could be completed this year.

Child nutrition. The Senate Agriculture Committee plans a markup Wednesday on draft legislation that would reauthorize child nutrition programs. Last month, the committee’s chairman, Kansas Republican Pat Roberts, and ranking Democrat, Debbie Stabenow of Michigan, said the child nutrition reauthorization was the committee’s top priority for 2016.

Islamic State. The Senate Homeland Security and Governmental Affairs Committee plans a hearing Wednesday on the goals and ideology of Islamic State terrorists, who have been linked to recent attacks in Paris, Istanbul and Jakarta.

Energy outlook. The Senate Energy and Natural Resources Committee plans a hearing Tuesday on the outlook for energy and commodity markets. Adam Sieminski, who heads the Energy Information Administration, is among those scheduled to testify.

Economic updates here and abroad will be a key focus. From the US side, housing updates, manufacturing and inflation are the key watch points. Tuesday will see the release of the Housing Market Index, with Tuesday updates on CPI and Housing Starts, with the inflation data of net given the downbeat figures on wholesale level inflation. Thursday’s updates include the weekly jobless claims and Philadelphia Fed report, with Friday’s releases including the Chicago Fed update, PMI manufacturing, Existing Home Sales and Leading Indicators.

The situation in China remains a major focus, with any actions by their government potentially important along with any economic data to be released today.

With Iran rejoining the oil export market, additional pressure could come there as Saturday saw Iran being declared conforming to its nuclear weapons agreement and confirmation that most sanctions were lifted.

The blackout period ahead of the next Federal Open Market Committee (FOMC) arrives Tuesday, one week ahead of the FOMC start the following week. That also means we won’t be hearing from Fed officials on monetary policy for the week. But that will not keep the focus off Fed watchers trying to handicap the next increase in the range for the Fed funds rate with each new piece of economic data, particularly the CPI update even though that is not the Fed’s “yardstick” for progress toward its inflation goal.

For agriculture, weather and outside markets will keep traders’ attention. Most of the weather-related attention will be on South America and South Africa unless there are any sudden shifts in US weather conditions. The US government will release updated weather outlooks on Thursday, outlooks that will be heavily influenced by the transition away from El Nino. The Monday holiday means that the Weekly Export Sales report will arrive Friday morning instead of its normal Thursday release. And Friday will feature other USDA updates, including Milk Production, Cold Storage and Cattle on Feed.

The watch will also be on to see if additional cases of bird flu turn up in Indiana after ten cases were confirmed over the weekend.

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