Looking Ahead: Week of June 17 through 22

Looking Ahead: Week of June 18 through 22 

The Bank of Japan, Reserve Bank of New Zealand and the Swiss National Bank left their respective monetary policies unchanged. However, all referred to the situation in Europe in their post meeting statement and reiterated their preparedness to act should it be necessary. US economic data disappointed for the most part. However, investors looked upon it as more reasons that the Federal Reserve will add stimulus to boost flagging growth when it meets on June 19^th and 20^th.

In Athens, the election was seen as too close to call. Alexis Tsipras, leader of the main anti-bailout leftist party SYRIZA, said on Thursday the deal with Greece's international lenders, which has helped push the economy into a depression, would not last beyond the weekend. SYRIZA is running neck-and-neck with the mainstream conservatives for Sunday's parliamentary vote, a re-run of an election last month that produced a stalemate in which neither the pro nor anti bailout camps was able to form a coalition. European leaders, however, have warned that Greece will get no help if it reneges. Officials have also hinted that Athens might be granted more time to achieve its fiscal targets if a new government sticks to the core reforms in the program.

Economic news was more on the negative side this past week.  Still, momentum is on the positive side but sluggish.  The big issue in the near term is whether Greek elections favor pro-euro candidates or not.  The outcome will likely impact financial markets more than real activity in the U.S.

Highlights are the highly anticipated Wednesday FOMC statement, FOMC forecasts, and chairman’s press conference. Traders expect at least some modest additional accommodation.  But housing gets second billing with the NAHB housing index on Monday and housing starts the next day and existing home sales and FHFA house prices on Thursday.