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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (5916)	4/8/2002 5:43:30 PM
From: John Pitera	Read Replies (1) \| Respond to of 33421

09:51 ET.... The consensus estimate for February wholesale inventories is for flat growth after 8 consecutive months of decline. The downtrend in inventory stock draws toward an end as the inventory to sales ratio stands at a 2 year low as expectations argue for a dip lower to 1.27 in Feb -- the lowest since Sep 1997. The end of business inventory liquidation is a very powerful upward force for Q1 GDP growth as estimates in the 4% to 5% range are tested with the April 26 GDP release, just a week before the FOMC decides the fate of policy rates. The risk is that the strong read on economic growth would help force long yields higher as growth and inflation (energy) fears build. We do not expect the Fed to react with a tightening at the May 7 meeting as suggested with the final demand (GDP ex inventories) statement in the March policy directive and the dovish tone among the majority of Fed speakers.