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US Credit Mkt Wk Ahd:GDP/Trade/Durables Focus, Fed In Blackout

     CHICAGO (MNI) - The week ahead data highlights include existing and new
home sales on Monday and Wednesday respectively, advanced trade and durable
goods orders on Thursday, and Q2 headline GDP on Friday.
     On GDP, Nomura expects "robust Q2 real GDP growth of 4.6% q-o-q
saar...mostly driven by solid contributions from personal consumption,
nonresidential fixed investment, and government consumption." 
     Credit Suisse economists "revised up" their "forecast for Q2 headline GDP
growth to 4.4% (QoQ annualized) from 3.7%," noting a "rebound in consumer
spending and a surprise narrowing of the trade balance are key drivers of this
pickup in growth in the second quarter. This is likely to mark a peak in growth
momentum, and we anticipate some slowdown in the quarters ahead."
     Thursday's durable goods and trade "could impact" CS' GDP estimate,
however. "expect headline durable goods orders to increase in June after two
months of declines, rising 3.0% MoM. Excluding transportation, orders likely
improved after a flat reading in May and we expect a small rise of 0.3% MoM."
     TD Securities also expect "a 4.4% q/q (saar) advance in Q2 GDP with upbeat
details reflecting robust consumption (3.2%), solid capex and a net boost from
trade. Estimates could be pushed higher following the advance trade and durables
reports ahead of the release."
     Meanwhile, the Federal Reserve's media blackout started Saturday and runs
through Thursday, August 2, the day after the next policy announcement where
markets are pricing in a very low probability of a hike around 5%.
     Making up for the blackout period Federal Reserve Chairman Jerome Powell
testified at length at the semi-annual monetary policy report last week.
     Chairman Powell's testimonies were generally upbeat, expressing little
concern over flattening in the yield and downplayed any near term threats to the
U.S. economy as a result of trade wars launched by the Trump administration, but
added protracted protectionist trade policies are not good for the economy in
the long run.
     Before the start of the blackout, however, St. Louis Fed President James
Bullard reiterated his stance that "yield curve inversion is a bearish signal"
for the economy, that "imminent" inversion is a "real possibility" that could be
avoided by being more cautious in the pace of tightening policy.
     Nevertheless, the door for two more rate hikes by year end has been left
open. MNI's PINCH model reflects near 90% probability of a third hike at the
September 25-26 policy meeting and near 50% for a fourth hike at the December
18-19 policy meeting.
     Nomura economists concur, expecting the Fed to hike a total of four times
in 2018, " and two hikes in 2019 before the FOMC takes an extended pause through
2020."
     Nomura added that "tax cuts and increased federal spending will help keep
growth above potential into 2019," while "waning fiscal stimulus, tighter
monetary policy and increased supply constraints should slow growth over 2019
and into 2020."
Calendar of next week's market events (prior, estimate): 
- Jul 21 Fed media blackout begins, runs through August 2
- Jul 23 Jun existing home sales (5.43M, 5.4M) 1000ET
- Jul 23 US TSY $45B 26W bill auction, Jul 26 settle 1130ET
- Jul 23 US TSY $51B 13W bill auction, Jul 26 settle 1130ET
- Jul 23 Jul Treasury Allotments (p) 1500ET
- Jul 24 Jul Philadelphia Fed Nonmfg Index (39.1, --) 0830ET
- Jul 24 21-Jul Redbook retail sales m/m (0.1%, --) 0855ET
- Jul 24 May FHFA Home Price Index (0.1%, --) 0900ET
- Jul 24 Jul Markit Services Index (flash) (56.5, --) 0945ET
- Jul 24 Jul Markit Mfg Index (flash) (55.4, --) 0945ET
- Jul 24 Jul Richmond Fed Mfg Index (20, --) 1000ET
- Jul 24 US TSY $35B 2Y note auction, Jul 31 settle 1300ET
- Jul 25 20-Jul MBA Mortgage Applications (-2.5%, --) 0700ET
- Jul 25 Jun new home sales (689k, 672k) 1000ET
- Jul 25 Jun bldg permits revision 1000ET 
- Jul 25 20-Jul crude oil stocks ex. SPR w/w (5.84m bbl, --) 1030ET
- Jul 25 US TSY $18B 2Y FRN note auction, Jul 31 settle 1130ET
- Jul 25 US TSY $36B 5Y note auction, Jul 31 settle 1300ET
- Jul 26 21-Jul jobless claims (207k, 216k)  0830ET
- Jul 26 Jun durable goods new orders (-0.4%, 3.2%) 0830ET
- Jul 26 Jun durable new orders ex transport (0.0%, 0.3%) 0830ET
- Jul 26 Jun advance goods trade gap (-$64.8B, --) 0830ET
- Jul 26 Jun advance wholesale inventories (0.6%, 0.3%) 0830ET
- Jul 26 Jun advance retail inventories (0.4%, --) 0830ET
- Jul 26 22-Jul Bloomberg comfort index (58.8, --) 0945ET
- Jul 26 Q2 housing vacancies rate 1000ET
- Jul 26 20-Jul natural gas stocks w/w (2,249 BCF, --) 1030ET
- Jul 26 Jul Kansas City Fed Mfg Index (28, --) 1100ET
- Jul 26 US TSY $30B 7Y note auction, Jul 31 settle 1300ET
- Jul 26 25-Jul Fed weekly securities holdings ($2.36T, --) 1630ET
- Jul 27 Q2 GDP (adv) (2.0%, 4.7%) 0830ET
- Jul 27 Q2 GDP Price Index (2.2%, 2.0%) 0830ET
- Jul 27 Jul Michigan sentiment index (f) (97.1, 97.2) 1000ET
- Jul 27 Q2 St. Louis Fed Real GDP Nowcast (3.7%, --) 1100ET
- Jul 27 Q2 NY Fed GDP Nowcast (2.7%, --) 1115ET
--MNI Chicago Bureau; tel: +1 312-431-0089; email: bill.sokolis@marketnews.com
--MNI Washington Bureau; tel: +1 202-371-2121; email: kevin.kastner@marketnews.com
[TOPICS: MTABLE,M$U$$$,M$$FI$,MN$FI$,MN$FX$]

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