The U.S. economy will be kicking off its week on Tuesday, as Americans enjoy the Labor Day holiday on Monday, while this week has little to offer, since few fundamentals will be released from the world’s largest economy, and the data due to be released this week won’t change investors’ perspective over the outlook.

The start dear reader will be with the Federal Reserve Bank’s Beige Book, which will show the recent developments in economic activities all across the nation, where the Beige Book is expected to signal the recent weakness in economic activities amid the ongoing challenges that continue to suppress economic growth including elevated unemployment and tightened credit conditions.

Moreover, the Beige Book will probably confirm the Fed’s recent projections for economic growth, where the Fed signaled at their FOMC Minutes released last week that economic growth will be moderate during the second half of this year before the economy can pick up some pace next year, while inflation remains well under control and is expected to remain rather low for some period.

The consumer credit index is expected to show a widening deficit in July to $5.5 billion, compared with the prior reported deficit of $1.3 billion, where consumer spending remains relatively weak and moderate, and that is restricting the economy from recovering over a stronger pace.

The trade balance for the month of July is expected to show that the trade deficit narrowed to $48.1 billion, compared with the prior reported deficit of $49.9 billion, where the falling value of the U.S. dollar could have helped in lowering the trade deficit, since a weak dollar makes U.S. goods look cheaper than foreign goods.

Also, the initial jobless claims will be released, where conditions in the labor market continue to be very challenging, as unemployment is still standing near its highest levels in nearly 26 years, and that is preventing the economy from reaching its full potential, noting that elevated unemployment is indeed one of the major reasons behind the recent slowdown in economic activities.

Finally, the wholesale inventories will be released for the month of July, where expectations signal that inventories increased by 0.4%, compared with the prior reported rise of 0.1% back in June, producers are starting to build their inventory levels, though over a very slow pace, since economic conditions are still very weak, while the outlook for the economy remains highly uncertain.

Financial markets will probably have a calm week, where the lack of data released will surely provide investors with a chance to reflect upon the recent developments, though we expect stock markets to continue their bullish wave, despite that recent data suggested that economic growth is slowing, yet we still expect optimism over the outlook for global growth to dominate markets…