Two Mondays ago, bond markets bounced at the exact same levels that followed the weak Jobs report on April 5th.  It became increasingly clear through the course of that week (4/15-4/19) that we were entering into some manner of sideways slide--not eager to extend already solid recent improvements, but clearly also not eager to head back into March's trading range.  To whatever extent that "sideways-ness" was clear, it was always stood it's best chance to be broken by the current week of data and events.  The following chart presents two ways to view the recent range in 10yr Treasuries: purely flat with a few "lead-offs" or slightly bullishly tilted (teal lines).  

There's significant economic data every day this week and several potential watershed moments.  The big-ticket events start hitting on Wednesday with ADP Payrolls (only inasmuch as it has the potential to suggest reevaluating expectations for the official Employment Situation Report on Friday--the biggest ticket of the week).  ISM Non-Manufacturing data follows later that morning, but is outdone by 2pm's release of the Fed's latest policy announcement.  This is the shorter, more precise text used to officially communicate the current policy (as opposed to FOMC "Minutes" which are longer, less formal, and slightly more open to interpretation).  Unlike the last FOMC Announcement, this one is not accompanied by forecasts from FOMC Members or the press conference from the chairperson.  Unless it differs meaningfully from the previous iteration, there's a good chance it won't have much impact, but the impact can be significant if it makes an overt change or a less-than-subtle hint that one is coming.

The pace of events doesn't let up on Thursday as the European Central Bank (ECB) is out with their analogous policy announcement.  A majority of economists polled by Reuters believe the ECB will cut rates for the first time in nearly a year.  It's not a given that this will happen, nor that it would be by the 0.50% amount predicted.  The divergent possibilities leave the door open for more volatility in bond markets following the announcement.  At the same time that ECB President Draghi begins his Press Conference 45 minutes after the announcement, so too will US Economic data begin coming in for the day with Jobless Claims as well as Productivity and Costs.

Friday morning remains the focal point of the week with Non-Farm Payrolls at 8:30am, though markets will have had plenty of opportunity to move even before then.  Take the last instance of an NFP week for example (it's on the chart above too!).  10yr yields began breaking below that 1.823% line on Wednesday and extended gains on Thursday only to have Friday's job's report motivate the biggest gains of the week.  That was a classic example of a pre-NFP "lead-off," and such things are especially possible when the rest of the week is fraught with other meaningful data.  

MBS Live Econ Calendar:

Week Of Mon, Apr 29 2013 - Fri, May 3 2013

Time

Event

Period

Unit

Forecast

Prior

Mon, Apr 29

08:30

Personal income mm

Mar

%

0.3

1.1

08:30

Consumption, adjusted mm

Mar

%

0.1

0.7

10:00

Pending sales change mm

Mar

%

1.0

-0.4

Tue, Apr 30

08:30

Employment costs

Q1

%

0.5

0.5

09:00

Case Shiller Home Prices

Feb

%

0.2

0.1

09:45

Chicago PMI

Apr

--

52.0

52.4

10:00

Consumer confidence

Apr

--

60.0

59.7

Wed, May 1

07:00

Mortgage market index

w/e

--

--

868.1

08:15

ADP National Employment

Apr

k

150

158

10:00

ISM Manufacturing PMI

Apr

--

50.9

51.3

10:00

Construction spending

Mar

%

0.8

1.2

14:00

FOMC Member Forecasts

N/A

%

--

--

Thu, May 2

07:30

Challenger layoffs

Apr

k

--

49.255

08:30

International trade mm $

Mar

bl

-42.5

-43.0

08:30

Productivity Revised

Q1

%

1.9

-1.9

08:30

Labor costs Revised

Q1

%

0.4

4.6

08:30

Initial Jobless Claims

w/e

k

346

339

Fri, May 3

08:30

Non-farm payrolls

Apr

k

150

88

08:30

Average workweek hrs

Apr

hr

34.6

34.6

08:30

Average earnings mm

Apr

%

0.2

0.0

08:30

Unemployment rate mm

Apr

%

7.6

7.6

08:30

Private Payrolls

Apr

k

168

95

10:00

Factory orders mm

Mar

%

-2.5

3.0

10:00

ISM N-Mfg Bus Act

Apr

--

56.0

56.5

10:00

ISM N-Mfg PMI

Apr

--

54.0

54.4

* mm: monthly | yy: annual | qq: quarterly | "w/e" in "period" column indicates a weekly report

* Q1: First Quarter | Adv: Advance Release | Pre: Preliminary Release | Fin: Final Release

* (n)SA: (non) Seasonally Adjusted

* PMI: "Purchasing Managers Index"