Canadian CPI tops the economic news of the day as markets receive the Fed's Beige Book and the Department of Energy's weekly oil inventories. In the afternoon, markets will also be paying attention o the sales of $31 billion in two-year Treasury notes.

At 7 a.m. EDT, Statistics Canada will release its consumer price index (CPI) for June. The consensus is for headline CPI to rise 0.5% month-over-month following the previous 1.0% increase. Annual headline CPI is expected to post a 2.9% annual gain, above the previous 2.2% increase. Core CPI is expected to rise 0.1% month-over-month following May's 0.3% gain, while annual core CPI is expected to tick up to 1.6% from 1.5% previously.

In the U.S., the Mortgage Bankers Association will release mortgage applications for the week ending July 18 at 7 a.m. EDT. In the previous week, applications rose 1.7%.

At 10:30 a.m. EDT, the Bank of Canada will sell C$2.0 billion in 2008.08.07 bills.

At 10:35 a.m. EDT, the U.S. Department of Energy will release oil inventories for the week ending July 18. Economists are expecting a 600k draw in crude oil reserves following the previous 2952k increase. Gasoline inventories are expected to rise 200k following the previous 2472k rise. Distillate inventories are expected to add 2500k barrels after rising 3189k in the previous week. Refinery utilization is expected to come in flat after rising 0.33% in the previous week.

At 1 p.m. EDT, the U.S. Treasury will sell $31 billion in two-year treasury notes.

At 2 p.m. EDT, the Fed will release its Beige Book economic report.

7:00 CA Consumer Price Index (M/M) June Exp: +0.5% Prior: +1.0%

7:00 CA Consumer Price Index (Y/Y) June Exp: +2.9% Prior: +2.2%

7:00 CA Bank Canada CPI Core (M/M) June Exp: +0.1% Prior: +0.3%

7:00 CA Bank Canada CPI Core (Y/Y) June Exp: +1.6% Prior: +1.5%

7:00 US MBA Mortgage Applications 18-July Prior: +1.7%

10:30 CA Bank of Canada will auction $2B in Cash Management Bill

10:35 US DOE U.S. Crude Oil Inventories W/E July 18 Exp:-600K Prior: +2952K

10:35 US DOE U.S. Gasoline Inventories W/E July 18 Exp: +200K Prior: +2472K

10:35 US DOE U.S. Distillate Inventory W/E July 18 Exp: +2500K Prior: +3189K

10:35 US DOE U.S. Refinery Utilization W/E July 18 Exp: 0.0% Prior: +0.33%

13:00 US Treasury to Sell $31B in 2-Year Notes

14:00 US Fed's Beige Book

By Erik Kevin Franco and edited by Nancy Girgis