Week Ahead: Retail Sales, Inflation and Earnings

Retail sales, inflation data and more earnings are on tap for next week.

April retail sales figures are due Thursday and the numbers are expected to be boosted a bit by a late Easter holiday, a three-day weekend during which stores use sales to lure in customers.

The warmer spring weather plus signs of growing consumer confidence as the economy rebounds little by little are also expected to help those retail numbers.

The Import Price Index, used to gauge inflation, is due on Tuesday.  Two other inflation barometers -- the Producer Price Index and the Consumer Price Index -- are due Thursday and Friday respectively.

Of the three, the Consumer Price Index, is likely to receive the most attention because of its potential impact on consumer spending, which makes up 70% of the U.S. economy.

Higher energy prices will likely impact all of the U.S. inflation data, even as a barrel of oil has fallen back to the $100 range. In most areas of the U.S., the price of a gallon of gasoline continues to hover just below the $4 mark.

Food prices, until recently a primary inflationary concern, seem to be moderating.

Economists have argued whether a loose U.S. fiscal policy has spurred inflation. If so, will a tightening of that policy threaten the fragile economic recovery?

So far the Federal Reserve Board, which has the power to tighten fiscal policy through higher interest rates, has maintained that rising fuel and food costs are temporary and that core inflation is moderate.

Speaking of consumer spending, two gauges of consumer confidence are due next week: the IBD/TIPP Economic Optimism Index on Tuesday and the preliminary Reuters/University of Michigan Consumer Sentiment Index on Friday. Again, rising gas prices should be the primary mover of those gauges.

The international trade deficit figure will be released on Wednesday.

The trade deficit will likely come up at the U.S.-China Strategic and Economic Dialogue, which will be held in Washington, D.C., on Monday and Tuesday. Chinese fiscal policy makers are scheduled to meet with their U.S. counterparts. Treasury Secretary Tim Geithner and Secretary of State Hillary Rodham Clinton are expected to attend.

Retail firms will dominate the earnings schedule:

On Monday. Dillards (NYSE:DDS) Grubb and Ellis (NYSE:GBE), and Tyson Foods (NYSE:TSN) report. On Tuesday, it will be  Starwood Property Trust (NASDAQ:STWD), Walt Disney (NYSE:DIS), and Wendy's/Arby's Group (NYSE:WEN). Wednesday brings numbers from Cisco Systems (NASDAQ:CSCO) and Macy's (NYSE: M), and Thursday is Kohl's (NYSE:KSS) and Nordstrom (NYSE:JWN).