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Tuesday: FOMC Meeting Starts

Will they or won¿t they? That's the question Wall Street will be asking Tuesday when the

Federal Reserve's

Federal Open Market Committee meets to discuss interest rate policy.

Most economists say there's nothing but the most remote chance the Fed will tinker with the economy by raising short-term rates. With inflation low and growth moderate, why would they muck up the mix?

"The news, on balance, indicates the economy remains strong," says Ed Nicoski, chief market strategist at

Piper Jaffray

. "But I don't see that inflation is a major concern at this time."

Today, the

National Association of Purchasing Management

said its key activity index came in at 52, lower that the 53.5 expected by the market but above the 50 mark. Anything above 50 suggests the economy is expanding. News that construction starts fell 0.7% in December also helped buoy bonds. Tuesday, traders can look to a slew of mostly minor data to scroll on their screens while waiting for news from the Fed.

Tuesday's numbers:

Leading Indicators

for December (10 a.m.): Consensus calls for a 0.1% rise, the same as in November.

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New Home Sales

for December (10 a.m.): Consensus calls for a 4.5% rise, down from the 14.2% in November (postponed from Jan. 31).

Federal Open Market Committee

(1 p.m.): Fed bigwigs meet to discuss rates. View from the trenches: No change.

Johnson Redbook

(2:55 p.m.): Retail sales report for the week ended Feb. 1.

Domestic Auto Sales

for January (Evening): Consensus calls for 6.7 million units, down from 6.8 million in December. Leave the driving to us.

State of the Union Address

(Evening): Bring a bag of chips.


(2:30 p.m.): Three- and six-month bill auctions.

By Andrew Morse