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April flowers for the economy?

By Mark Hamrick ·
Monday, April 7, 2014
Posted: 6 am ET

Here in Washington, the cherry blossoms are out in full glory. It's something that happens ever so briefly, at the beginning of springtime. The burst of color comes after a winter in which some folks were wondering if they'd ever see anything but gray again.

After an employment report on Friday that seemed to reflect spring temperatures (not too hot, not too cold), we'll be looking for any kind of sizzle amid a kind of B-league series of economic reports due this week.

Updates on credit, prices and more

Here's what's on tap this week:

  • The Federal Reserve reports on February consumer credit, Monday at 3 p.m. (all times Eastern).
  • The Federal Reserve releases minutes from the March policy-setting meeting, Wednesday at 2 p.m.
  • The Labor Department releases new weekly claims for unemployment benefits, Thursday at 8:30 a.m.
  • The Labor Department reports on the March Producer Price Index, Friday at 8:30 a.m.

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Chewing on the rising cost of food

Have you checked your grocery bill lately? We follow food from farm to table to learn why it's costing more.


Gauging the Federal Reserve's plans

Release of the Fed's meeting minutes will give additional insight into the most recent policy-setting session, in March.  The document provides a bit of color on the behind-the-scenes discussion about monetary policy, including what led to the decisions to continue reducing asset purchases and hold interest rates at record-low levels. It was also the first time that Chair Janet Yellen presided over a meeting.

With the unemployment rate stuck at 6.7 percent amid steady but only moderate jobs creation, what is the Fed looking at?

"I believe the Fed will be focusing on any signs of upward wage pressure in future jobs reports as an indicator for potential timing on future policy tightening, i.e., raising overnight rates," says Alan MacEachin, corporate economist with Navy Federal Credit Union.

Wage pressure has been virtually nonexistent recently. So, there's no green light flashing for Yellen and her fellow central bankers to lift interest rates just yet.

Inflation, what inflation?

With wage gains restrained, broad increases in prices have largely been absent in not only the U.S. but also the global economy. Economists expect the Producer Price Index, the main gauge of inflation at the wholesale level, will show little change in March, despite increasing food costs.

Downward price pressure is getting some help from falling energy costs, according to economists at IHS Global Insight.

Slack in the economy and tame core inflation (excluding food and energy) "should keep the Fed from tightening policy at least until the latter half of 2015," says MacEachin.

This week in business history

April 11, 1976: a sort of birthdate at the then-upstart Apple computer company.

Apple's first personal computer was released, designed and built by company co-founder Steve Wozniak. Legend has it that to finance the effort, partner Steve Jobs sold his Volkswagen Microbus and Wozniak sold his scientific calculator.

Let me know what you expect with the economy or your personal finances and follow me on Twitter: @Hamrickisms.

And for a look between the lines of the Fed's most recent policy announcement, check out "What did the Federal Reserve say?"

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