|06:10||Bullard (FOMC voter)||On U.S. economy and monetary policy|
|08:30||Durable goods||Small increase likely in April|
|08:30||Jobless claims||Should hold close to recent average|
|10:00||Pending home sales||Third straight increase in April?|
|11:00||Kansas City Fed index||Unchanged at mildly negative level in May|
|11:00||3- and 6-month bill announcement||No changes expected|
|11:00||4-week bill announcement||Announcement moved up due to holiday|
|12:00||Powell (FOMC voter)||On the economy|
|13:00||7-yr note auction||4th consecutive $28 billion offering|
Today’s calendar starts off with the weekly jobless claims report and the advance durable goods report, both at 8:30. We expect both initial and continuing claims to hold roughly steady in their respective reporting weeks, and we think overall durable goods orders may eke out a small increase in April. We look for a third consecutive increase in pending home sales in the April report at 10:00, while the Kanas City Fed factory index for May, at 11:00, may hold steady at last month’s mildly negative level.
Today’s announcements: 4-week and 3- & 6-month bills
Today’s auction: 7-year notes
Note: the Treasury’s 4-week bill auction announcement has been moved up to this morning due to the Memorial Day holiday.
Last week’s FOMC minutes stopped short of signaling a rate hike in June, but leaned harder in that direction than we anticipated. Upcoming public appearances by Fed officials, especially Chair Yellen, will be critical to the outlook.
Separately, the Alternative Reference Rate Committee published an interim report on Friday. The committee has tentatively narrowed the list of next-generation reference rate candidates to two options: the Fed’s new Overnight Bank Funding Rate and some to-be-determined Treasury GC repo rate alternative. The report also lays out a tentative strategy for building liquidity in the early phases of adopting the new benchmark. The report urges market participants to comment on the proposals by July 15.