1. Japanese Eco Watchers
2. US Trade Balance
3. University of Michigan Confidence

Japanese Eco Watchers Outlook (APR) (05:00 GMT; 01:00 EST)
Consensus: n/a
Previous:  56.2

Outlook:  The Economic and Social Research Institute's measure of general sentiment across both the consumer and business sectors in the Japanese economy could have taken a hit in April.   A leading indicator for the country, the Eco Watchers' survey for last month will juggle conflicting indicators for health in households while at the same time dealing with faltering business confidence.  Households whose positive expectations have grown markedly over the first three months of the year, were faced with a 4.1%, 7-year low unemployment rate while the annual overtime earnings change grew 1.9% the month before for the 44th consecutive monthly rise. In spite of this positive news, consumers seemed to take their positions more critically.  Domestic vehicle sales in April plummeted 7.8% while retail sales the month prior fell 0.3% on the month.  However, the longer, annually based measurement actually rose 1.0% suggesting a longer, more gradual improvement.  On the other side of the market, businesses were showing some hesitation as their dependence on outside resources began to way on budgets along with higher commodity prices.  Generally regarded as a reliable gauge of sentiment that precedes spending habits in the coming months, the Eco Watchers survey could become another indicator in a list of such indicators that the BoJ will closely evaluate when making the long anticipated decision to boost overnight lending rates off of 0%.

Previous:  Japanese household and businesses' expectations for the coming months dimmed slightly in March led by a large decline in confidence amongst manufacturers.  Overall, the indicator fell off of February's 56.6 read, the highest since records started in 2000, to 56.2.  A read above 50 indicates growth.  Among the sub-components, it was immediately recognizable that businesses' interpretation of future strength was the worst off.  Despite dropping crude oil prices, one of the largest expenses for the manufacturing-heavy economy, business leaders were aware of the potential for the volatile good to quickly return to previous highs.  Also loosing its sheen were households' expectations of the service industry, though the same was not reflective from the business standpoint.  Forecasts for the non-manufacturing sector rose to 56.7 from 55.5 for firms, while the households read dropped from 60.1 to 57.4.   Providing the most impressive improvement in sentiment, and largely offsetting the lack of enthusiasm in the aforementioned decliners, was the housing market.  With the Bank of Japan abandoning its ultra-loose monetary policy and expected to adopt higher interest rates in the near future, citizens have are beginning to see the investment potential of their residences. 

US Trade Balance (MAR) (12:30 GMT; 08:30 EST)
Consensus: -$67.0B
Previous:  -$65.7B

Outlook:  The trade shortfall in the world's largest economy is expected to broaden once again in March as the prices of imported raw materials rebounds from February easing and Chinese production resumes.  The market consensus for a $67 billion deficit would make the imbalance the third largest on record and is particularly distressing for growth forecasts considering the prolonged deficit in the local government's budget.  Imports likely picked up pace in March, following February's contraction, as Chinese firms crank up factory output after the lunar New Year celebration.  According to a Chinese customs bureau, China's surplus with the US rose 39% in March.  Commodity prices, especially those of energy, are also going to be a factor in the growing imbalance.  Energy prices, led by crude oil, rebounded heartily in March as geopolitical tension and supply concerns encouraged bidding.  Also playing no little part in the return to growing deficit figures will be the demand at home.  Consumer sentiment hit a four-year high in March, stoking spending habits, which will undoubtedly translate to greater purchases of foreign products.  With the Fed growing increasingly neutral over its interest rate concerns, focus in the currency markets will begin to make the shift to the next most concerning economic data series the US has to offer - and that just happens to be the US Trade Balance.

Previous:   February's trade balance fell from the record $68.59 billion shortfall set the month before as the deficit with China improved and demand for foreign goods waned over concerns of higher costs.  For the month, imports fell 2.3% while exports lost 1.3% of value to trim the overall deficit 4% to $65.7 billion.   Despite the easing in both component figures, each stood at their second highest levels ever.  US demand for imports was driven both by tastes and a corresponding decline in Chinese production activity.  American consumers restrained their purchases of foreign goods in February as fears of recent energy prices left shoppers hesitant to part with their earnings.  Imports of autos dropped 5.8% while those of aircraft dropped 24%.  Watch was most noticeable to many however in amongst the trade data was the lowest deficit with China in nearly a year.  The US shortfall with China fell to $13.8B, the slightest level since March of 2005 as the country's factories closed for the New Year holiday.  Overall, the market's tone on February's surprising rate of contraction is that it is just temporary.  With indicators already supporting a rebound in the deficit, economists and analysts alike took the release with a grain of salt.

University of Michigan Consumer Confidence Survey (MAR) (13:45 GMT; 09:45 EST)
Consensus: 86.0
Previous:  87.4

Outlook:  Despite a multitude of economic indicators that would suggest otherwise, the University of Michigan's advance measure of consumer confidence for May is expected to decline to a read of 86.0 largely on one factor - gas.  Gasoline prices have crept up to near record prices over the past few weeks and official organizations have produced estimates for average gas prices over the summer driving season that have left many citizens in a panic.  The average price of gas across the nation rose steadily since the end of March to reach $2.91 per gallon, just $0.20 from Katrina levels.  Really exacerbating concerns however are predictions from analysts and the media that suggest these inflated prices could last through just the driving season - 6 months - or all the way out for three years.  If the weight effects of the volatile energy are ignored for a moment however, there is good reason for consumers to be confident.  First quarter economic came almost in line with expectations with 4.8% growth, personal income continues to rise and meet inflation, unemployment is at four year lows and the housing market has posted strong numbers over the past few weeks.  However, the overriding tone of confidence will remain dominated by the most immediate and distressing indicator; and right now, that just happens to be gasoline.

Previous: Consumer sentiment fell from its final March figure of 88.9 to 87.4 in April as concerns over the price at the pump surpassed optimism that was provided by a solid job market and a rising stock market.  When deciding their level of confidence in April, the true topic of interest for Americans was the uninterrupted trend of higher prices at gas stations.  Since March, gasoline prices began a steady run of higher prices that brought the fears of post-Katrina prices back into the realm of possibility. This concern was so great that it outstripped potential optimism that could have been garnered from the stock market's rally to 6-year highs.  Even direct contributions to consumers' wallets couldn't shake their apprehension.  The unemployment rate duplicated its 4.7%, four-year low in April signifying the strong standing US workers were in.  In the component gauges, current conditions edged higher to 109.2 from 109.1 the month before. Expectations however fell to 73.4 from 76.0.  Also of note, the 1-year inflation expectations sub-index rose from 3.0% to 3.3% for the period.

Richard Lee is a Currency Strategist at FXCM.