Last week, President Obama and congressional leaders failed to reach a deal on the automatic budget cuts known as sequestration, triggering across-the-board reductions in defense and domestic spending.
Federal Reserve Chairman Ben S. Bernanke warned Congress that the sequester would negatively affect growth. This week, the Fed is slated to weigh in with its outlook for the economy.
An update on unemployment and other economic data this week could show how much the economy was affected by the threat of the sequester.
Investors will get another chance to see if the Dow Jones industrial average reaches an all-time high, despite Washington’s budget discussions. The index closed at 14,089.66 on Friday, nearing the last recorded high (of 14,164.53 points) on Oct. 9, 2007.
The Institute of Supply Management releases its nonmanufacturing index at 10 a.m. Analysts expect the index to drop slightly to 55, from 55.2.
First up, the payroll-processing firm Automatic Data Processing releases its estimate for private-sector job growth in February. Forecasters expect that the sector added 170,000 jobs last month, down from 192,000 jobs in January.
At 10 a.m., January factory orders are released. Orders are projected to fall by 2.2 percent, following a rise of 1.8 percent in December.
The Federal Reserve’s “beige book,” which provides an anecdotal look at the state of the economy, is made public at 2 p.m.
Analysts expect weekly jobless claims to rise to 355,000, up from 344,000 last week.
International trade figures for January are released by the Commerce Department at 8:30 a.m.
The deficit is projected to widen to $43 billion, from $38.5 billion.
Data on consumer credit for January are out at 3 p.m. The total is expected to increase to $15 billion from $14.6 billion.
The Labor Department’s unemployment report for February is out at 8:30 a.m. The jobless rate is expected to stay steady at 7.9 percent.
— Amrita Jayakumar
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