With several economic items on the docket, the key event today is the start of Ben Bernanke's Humphrey Hawkins semi-annual report on the monetary policy to Congress (tomorrow an identical one will be delivered to the corrupt, brain dead zombies in the Senate). Look for select key words such as "QE3", "Ponzi", "Catastrophe", "Pray", and, of course, "Get tu da choppa"
7:30: Mortgage applications: MBA mortgage applications index fell 5.1% week ended July 8; Refis down 6.2%, 4th declining week; Purchases declined 2.6%; rose last week; Avg. 30-yr fixed rate 4.55% vs prior week’s 4.69%, biggest drop in 3 months; Share of applicants seeking refi 65.6% vs prior week’s 66.4%
8:30: Import/export price indexes (June). Lower commodity prices. The drop in commodity prices in May and June likely reduced US import prices indexes for June (the GSCI fell by about 9% over these two months). On a broad trade-weighted basis the dollar has been roughly flat for the last few months, and we therefore expect only small gains in non-commodity import prices.
Median forecast (of 50): -0.6%; last +0.2%.
9:10: Boston Fed President Eric Rosengren on the economic outlook.
10:00: Federal Reserve Chairman Ben Bernanke delivers his semi-annual monetary policy report to the House of Representatives. We expect Bernanke to 1) reiterate disappointment with the pace of growth and particularly the state of the labor market, 2) explain why most Fed officials still believe, as we do, that growth will improve in the second half, but 3) probably stop short of enumerating specific easing options should conditions deteriorate further (although these are likely to be addressed in the question and answer session following the testimony). He will also likely urge Congress to resolve the debt ceiling impasse as soon as possible.
13:00: Treasury auctions off $21 billion in a 10 Year reopening (link)
13:20: Dallas Fed President Richard Fisher on the economic outlook.
14:00: The US budget balance (June). The CBO estimates that the June budget deficit declined by $23bn from the same month last year on reduced outlays.
CBO -$45bn; median forecast (of 30) -$45bn; last (June 2010): -$68bn.
From GS, Bloomberg, SMRA and ZH